Shares of Planet Fitness (NYSE:PLNT), one of the largest and fastest-growing fitness-center operators in the United States, climbed 12% in August, according to data provided by S&P Global Market Intelligence. The stock's rise was, most likely, driven primarily by solid second-quarter results and an analyst's 12-month price-target increase for the stock.
For its second quarter, Planet Fitness reported revenue of $107.3 million and adjusted earnings per share of $0.22. These figures were up 17% and 29% year over year, respectively, exceeding analysts' consensus estimates for the quarter.
After Planet Fitness reported its second-quarter results, Roth Capital analyst Dave King said strong membership growth and margin improvement led him to increase his price target on the stock from $23 to $27.
Planet Fitness's nice year-over-year rise in revenue was helped during the quarter by impressive same-store sales growth of 9%. The rise in same-store sales extended a trend of growth in the key metric, marking the company's 42nd consecutive quarter of same-store sales growth.
Thanks to growth in its high-margin franchise segment, Planet Fitness' earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 30% year over year.
After the better-than-expected results, management increased its guidance for full-year results. Planet Fitness now expects full-year 2017 revenue between $409 million and $415 million, up from a previous guidance range of $405 million to $415 million. Similarly, management now expects same-store sales growth of 8% to 9% during this period, up from a previous expectation of 7% to 8%.
CEO Christopher Rondeau was optimistic in looking ahead:
I am confident that our compelling concept and powerful brand recognition combined with unmatched systemwide leadership and resources will allow us to capitalize on opportunities that drive long-term value for our shareholders.