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Why Peloton Stock Popped to a New All-Time High Today

By Joe Tenebruso – Updated Oct 9, 2020 at 7:20PM

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The popular fitness brand is growing at a torrid pace.

What happened

Shares of Peloton Interactive (PTON 3.43%) rose 7% to a new closing high of $123.02 on Friday, as investors continue to pile into the home-based fitness leader's stock. 

So what 

Analysts have anointed Peloton as a preeminent stay-at-home stock in recent weeks, and its shares have surged 44% in just the last month following its blockbuster fourth-quarter financial report. Peloton's revenue exploded 172% higher to $607.1 million, driven by strong sales of its stationary bikes and treadmills. Due to the coronavirus pandemic, more people are choosing to exercise in the comfort and safety of their own homes. 

A woman exercises on a Peloton bike while watching a fitness class.

Peloton's home-based exercise equipment is in high demand during the COVID-19 crisis. Image source: Peloton.

Peloton has also built a booming subscription business. More than 1 million customers who purchased its exercise equipment pay $39 per month to access Peloton's fast-growing library of fitness classes. 

Now what 

While skeptics caution that Peloton's expansion initiatives are weighing on its profitability, the hard-charging company's leadership is keeping its foot on the growth pedal. CEO John Foley thinks Peloton's subscriber base could eventually approach 100 million, based upon the nearly 200 million gym members worldwide. If he's even close to being correct, Peloton's shareholders could enjoy more gains in the years ahead.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Peloton Interactive. The Motley Fool has a disclosure policy.

Stocks Mentioned

Peloton Interactive Stock Quote
Peloton Interactive
$11.77 (3.43%) $0.39

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