- NASDAQ:PTON drops 9.64% on Thursday amidst hard-hitting tech stock selloff.
- Peloton hit an all-time high on Wednesday after Wall Street analysts gave a new price target upgrade.
- The home fitness industry continues to thrive during COVID-19 quarantine.
The all-time highs set on Wednesday were short-lived for Peloton (NASDAQ:PTON) investors as the bottom fell out from under the stock market on Thursday with all major indices taking triple-digit losses – especially the tech-heavy NASDAQ which fell nearly 600 basis points, just under 5%. Peloton has been on a tear this year, up 253% over the past 52-weeks, with much of that coming during the coronavirus quarantine where home fitness options have been in high demand. Even with the near 10% drop on Thursday, Peloton is trading well above its 60-day and 200-day moving averages.
Morgan Stanley analyst, Doug Anmuth, triggered a spike on Wednesday when he doubled down on the firm’s overweight position on Peloton and raised the target price for the stock from $58 to nearly double at $105, which represents a near 30% upside from Thursday's closing price and a 15% upside from the all-time highs reached on Wednesday. Despite the hefty price tag for products like Peloton’s stationary bike, which sells for over $2000 and can take six to seven weeks to ship, demand is still high as people continue to look for indoor exercise options.
PTON stock chart
Investors who believe in Peloton long-term may want to take this dip as an opportunity to initiate or add to their positions. Recently, rumors of a new cheaper Peloton treadmill and other equipment like a rowing machine have made their way on the internet, which shows just how broadly Peloton is thinking. With the next quarterly earnings call on September 10th and numerous Wall Street analyst upgrades, including a subsequent one from Goldman Sachs, the stock may not be this low again for quite some time.
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