What happened
Shares of exercise company Peloton Interactive (PTON +0.55%) were down sharply on Friday even though one prominent analyst said the stock could double from where it trades right now. Typically a bold statement like that would be a positive catalyst for the share price. But as of 1:10 p.m. ET, Peloton stock was down 12%.
So what
Oppenheimer analyst Brian Nagel offered his assessment of Peloton's business for the first time today. According to The Fly, Nagel believes that Peloton stock could hit $20 per share, representing roughly 100% upside from where it trades right now. He's hopeful that better management can turn the company around, although he admits that this bullish call is still pretty speculative.
NASDAQ: PTON
Key Data Points
Piper Sandler analyst Edward Yruma is less optimistic. The analyst also released thoughts on Peloton today, giving it a neutral rating and a price target of $12 per share. That said, this still suggests 20% upside, which is potentially market-beating over a one-year timespan.
Now what
Investors may be surprised that analysts are warming up to a Peloton investment, considering it's fallen 94% from its all-time high due to a series of managerial mistakes. However, under new management, Peloton does have a path to improve its profitability. And if it's able to execute on its plan, then shares look cheap right now and could very well support Nagel's $20 per share price target.
However, turnarounds are hard to pull off. Therefore, Peloton's management will certainly have its hands full trying to stop the cash burn.
