UPDATE: Bernstein Starts Peloton Interactive (PTON) at Outperform
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Bernstein initiates coverage on Peloton Interactive (NASDAQ: PTON) with a Outperform rating and a price target of $40.00.
The analyst comments "After a catastrophic fall from grace, Peloton has a new CEO, a new supply chain strategy, and a tighter belt on operating expenses. Meanwhile, the underlying business is still healthy, with a highly engaged user base, a sticky subscription-based revenue stream, and a large and fast-growing TAM. Today, the market is pricing in the worst outcomes, and our worst-case scenario modelling still yields a positive adj. EBITDA next year. Looking across a range of fitness hardware and subscription comps, we think a valuation range of 3-4x is fair and we take the low end of the range, valuing Peloton at 3x EV/Sales versus 2x current price."
Shares of Peloton Interactive closed at $21.14 yesterday.
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