From their initial public offering in September 2019 to their peak in January 2021, shares of Peloton Interactive (PTON 5.27%) skyrocketed by 550%. That monster run would've turned a $155,000 initial investment into $1 million at its all-time high in about 16 months.

But since that peak, this consumer discretionary stock has lost about 98% of its value. Now trading at a price-to-sales ratio of 0.5, some investors might view this business as a buying opportunity that's hard to pass up. But could Peloton stock help you become a millionaire one day from today's levels?

The most optimistic scenario

Let's first consider the most optimistic scenario for Peloton.

There's no denying that in order to skyrocket in value again, the company would need to return to rapid growth first and foremost. From its fiscal 2017 through its fiscal 2021 (which ended June 30, 2021), the company's revenues rose about 18-fold, thanks to heightened consumer interest in home workouts. If there's a return to levels even remotely resembling this type of growth, then the stock price should follow.

Moreover, Peloton was close to achieving profitability during the depths of the pandemic, and it posted positive free cash flow in fiscal 2020. If the business becomes financially sound from a bottom-line perspective, investor enthusiasm will soar.

Today, its market cap is around $1.38 billion. Consistent fast revenue growth, coupled with expanding profitability, could maybe get Peloton back to its all-time-high market cap of $49.3 billion in a decade. That would give those who invest in it at current levels a 35-fold gain. This means that all it would take is a $29,000 initial investment to wind up with a position worth seven figures.

Let's be realistic

To be totally clear, I give that optimistic scenario a less than 5% chance of actually happening. It just doesn't seem like a plausible outcome.

There's no denying that Peloton has been struggling in remarkable fashion. Its sales continue to decline with each passing quarter. Consumers just aren't as excited to spend on expensive home exercise equipment as they were when social distancing efforts and lockdowns were the order of the day. Peloton's fiscal Q3 2024 sales of $718 million were a gut-wrenching 43% lower than in the same period three years before.

This is a company that is trying mightily to turn things around. Yet the business also keeps posting net losses, and there seems to be no end in sight to them. And its subscriber base is essentially flat.

"Turnarounds seldom turn," the great Warren Buffett once said. I believe this is the most accurate way to view Peloton's situation.

Management has tried different strategies to drum up demand, like selling products on Amazon and at Dick's Sporting Goods, entering into partnerships with Lululemon Athletica and TikTok, and tweaking its digital app strategy. But these efforts don't seem to be moving the needle at all.

At the end of the day, Peloton remains a very speculative company to own. There is just way too much uncertainty surrounding what the business will look like even 12 months from now, let alone five years.

Investing is all about finding high-quality companies to own for the long haul. If you're looking at Peloton as a possible ticket to help grow your portfolio into the seven-figure realm, think twice. Not only is it unlikely that Peloton will make you a millionaire one day, but its stock could continue to be a terrible performer for the foreseeable future.

This is a stock that is best avoided.