John Baumgartner, an analyst from Mizuho Securities, maintained the Buy rating on Life Time Group Holdings (LTH – Research Report). The associated price target is $27.00.
John Baumgartner’s buy rating for Life Time Group Holdings (LTH) is grounded on several key factors. The company’s Q3 EBITDA surpassed predictions and its Q4 predictions are also looking optimistic. Baumgartner points to the growing evidence of operating leverage following the reinvestments made in FY22, with new clubs performing better than expected, resulting in an increase in Q3 center memberships and a healthy average center revenue per membership. This is a clear indicator of the positive impact of the investments made in FY22, which are driving a recovery in in-center revenue.
Despite Q4’s lighter revenue guide possibly disappointing some, Baumgartner believes the overall growth is still significantly better than anticipated negative expectations, and this should be more than compensated by EBITDA upside, accelerating deleverage, and the forecast to be free cash flow positive after all capital expenditures by mid-2024. The rarity of such operating leverage stories within the health and wellness space, combined with growing confidence in execution, bolsters Baumgartner’s buy rating on LTH shares. Furthermore, the shares are trading at roughly a 30% discount compared to Healthy Living peers, indicating a potential for future price appreciation.
According to TipRanks, Baumgartner is a 4-star analyst with an average return of 3.9% and a 53.95% success rate. Baumgartner covers the Consumer Defensive sector, focusing on stocks such as Nomad Foods, Simply Good Foods, and SunOpta.
In another report released yesterday, Oppenheimer also maintained a Buy rating on the stock with a $33.00 price target.
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Life Time Group Holdings (LTH) Company Description:
Life Time Group Holdings Inc is primarily engaged in designing, building, and operating distinctive and large, multi-use sports and athletic, professional fitness, family recreation and spa centers in a resort-like environment, principally in residential locations of major metropolitan areas in the United States and Canada.
Read More on LTH:
- Life Time Group cuts FY23 revenue view to $2.21B-$2.22B from $2.24B-$2.27B
- Life Time Group sees Q4 revenue $555M-$565M, consensus $577.1M
- Life Time Reports Third Quarter Fiscal 2023 Financial Results
- Life Time Group reports Q3 adjusted EPS 13c, consensus 12c
- Life Time to Acquire Arden Hills Athletic & Social Club Property in Sacramento in Early 2024
