Planet Fitness (PLNT) PT Raised to $26 at Imperial Capital

October 31, 2016 8:18 AM EDT
Get Alerts PLNT Hot Sheet
Price: $20.35 -0.78%

Rating Summary:
    13 Buy, 1 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 22 | Down: 32 | New: 34
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Imperial Capital analyst George Kelly reiterated an Outperform rating and raised his price target on Planet Fitness (NYSE: PLNT) to $26.00 (from $25.00) following Q3 results.

Kelly highlighted:

3Q16 results summary. On 10/26/16, Planet Fitness reported revenue and adjusted EBITDA of $87mn and $35mn, respectively, versus our estimates of $80mn and $32mn. Results benefitted from system wide same store sales growth of 10%. Total membership grew 21% year-over-year (yoy) to 8.7mn. We believe Planet’s brand and model continue to resonate with consumers.

Franchise business. The franchise business (excluding commissions) grew 43% yoy, well above recent growth, due to higher franchise fees and growth in franchise level revenue. The owned club base also delivered yoy growth, albeit at a slower rate.

Guidance update. Management raised 2016 guidance for the third time this year. Revenue and EPS guidance grew to $373mn–378mn and $0.66–0.67 versus $366mn–372mn and $0.62–0.65.
Management reiterated same store sales growth of HSD.

Special dividend. Management announced that it is hoping to expand its credit facility and will utilize it and existing cash to fund a $280mn special dividend. Leverage would grow to 4.6x.

For an analyst ratings summary and ratings history on Planet Fitness click here. For more ratings news on Planet Fitness click here.

Shares of Planet Fitness closed at $21.16 yesterday.

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