Peloton to Remain the Clear Leader in Connected Fitness, Says Morgan Stanley By

Peloton to Remain the Clear Leader in Connected Fitness, Says Morgan Stanley By

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By Sam Boughedda — On Monday, Morgan Stanley analyst Lauren Schenk initiated coverage of Peloton Interactive, Inc. (NASDAQ:) with an ‘equal weight’ rating and a $32 price target.

In a note to clients, the analyst said they expect Peloton “to remain the clear leader in connected fitness, with its industry-leading content and low churn as the key shareholder value.” 

However, Schenk explained that they lack visibility and conviction in the medium-term outlook as they await more detail around Peloton’s new CEO, Barry McCarthy’s strategy, including equipment pricing changes, subscription pricing, and the evolution of the content platform. 

“We could turn more positive if we gain more visibility/conviction around the direction of the key inputs around the three year outlook,” added Schenk. “While we expect PTON to remain the clear dominant player in the bike market long-term, we don’t expect any new modality to drive as much unit sales or revenue as the bike.”

Elsewhere, JMP Securities analyst Andrew Boone said they see “strong” initial demand for Peloton’s all-in subscription pricing.

Peloton fell over 1% in the early part of Monday’s session.

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