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Why Peloton Stock Jumped on Thursday but Pulled Back After Market Close

By Daniel Sparks - Updated Feb 4, 2021 at 5:52PM

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Following an upbeat day for the stock during regular trading hours, Peloton just reported some huge, fiscal second-quarter growth.

What happened

Shares of connected fitness product company Peloton Interactive (PTON -2.00%) jumped sharply on Thursday. The stock closed the trading day up more than 7%.

The growth stock was likely rising in anticipation of the company's quarterly results after market close. Some investors may have been expecting a blowout quarter.

A man riding a Peloton bike in a sunny room while a woman walks behind him.

Image source: Peloton Interactive.

So what

With Peloton's fiscal second-quarter results now released, it's clear that the company did enjoy impressive momentum during the period. But based on the stock's move in after-hours trading, investors may have been expecting even better results. As of 4:15 p.m. EST in after-hours trading, the stock is down more than 5%, trading close to levels it started the day at.

Peloton's fiscal Q2 revenue soared 128% year over year to $1.06 billion, beating a consensus analyst forecast for revenue of $1.03 billion. Earnings per share (EPS) were $0.18, up from a loss of $0.20 in the year-ago quarter. On average, analysts were expecting EPS of $0.09. 

Importantly, the company's connected fitness subscriptions jumped 134% year over year.

Now what

After-hours trading, which isn't as liquid as trading during regular trading hours, isn't necessarily a good representation of how the stock will trade when the market opens tomorrow. So it's tough to know exactly how the market will react to the just-released earnings report tomorrow. For now, however, it seems that the results didn't quite live up to the market's view.

One thing is clear: Peloton's business momentum remains staggering.

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