Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

If You Put $1,000 Into Peloton Last January, Here's How Much You'd Have Now

By Matthew Frankel, CFP® - Dec 9, 2020 at 6:33AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The home fitness company has been a big beneficiary of the stay-at-home economy.

When the coronavirus outbreak spread across the United States in early 2020, it dramatically changed the daily lives of Americans -- including the way we exercise. Since gyms were no longer an option (and still aren't in some areas), people needed to figure out a way to get effective workouts at home, and fitness technology company Peloton Interactive ( PTON 9.88% ) was a major beneficiary.

In fact, at many times during the pandemic, the company had trouble making and delivering enough bikes to keep up with demand.

Woman exercising with Peloton bike nearby.

Image source: Peloton Interactive.

Not surprisingly, Peloton's stock has been one of the market's best performers. The company, which sells high-end fitness equipment such as its signature stationary bike as well as subscriptions to classes, has thrived in 2020. As a result, its stock has more than quadrupled. A $1,000 investment in Peloton at the start of the year would now be worth $4,055.

Will Peloton thrive in a post-pandemic world?

The billion-dollar question when it comes to Peloton, as well as other stocks benefiting from the stay-at-home economy is: What happens after the COVID-19 pandemic is over? Will people continue to exercise at home, or will many of Peloton's users go back to the gym?

There's no way to know for sure how consumers will act in a post-pandemic world, but one interesting thing to keep in mind is that Peloton's customers had a large upfront expense.

For context: Someone who decided to buy a Zoom ( ZM 3.07% ) subscription to continue to have meetings during the pandemic simply pays a monthly cost. On the other hand, someone who already paid about $2,000 for an exercise bike might think twice about canceling their $39 monthly membership that is needed to make the bike useful.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Peloton Interactive, Inc. Stock Quote
Peloton Interactive, Inc.
PTON
$45.91 (9.88%) $4.13
Zoom Video Communications Stock Quote
Zoom Video Communications
ZM
$194.86 (3.07%) $5.80

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
652%
 
S&P 500 Returns
142%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/08/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.