Barry McCarthy, the CEO of exercise equipment and media company Peloton Interactive, Inc. (NASDAQ: PTON), has denied reports of the company considering to sell itself, StreetInsider.com said. Instead, Peloton plans to expand into new markets and produce new content, McCarthy said.
The PTON stock jumped significantly last week on reports of Nike (NYSE: NKE) and Amazon (NASDAQ: AMZN) being interested in acquiring it following an 80% decline in Peloton’s market cap.
The sale rumors were prompted by McCarthy shifting base from California to New York immediately after becoming the CEO.
However, McCarthy denied the reports and said his move was aimed at capturing a growth opportunity.
“If I thought it was likely that the business was going to be acquired in the foreseeable future, I can’t imagine it would be a rational act to move across the country,” he said.
“There are lots of other things I could be doing with my time that are quite lucrative than hanging out with a business that’s about to be sold,” McCarthy added.
Based out of New York, Peloton provides interactive fitness products such as the Peloton Bike and the Peloton Tread for live and on-demand classes.
The PTON stock closed 5.3% down on Monday but gained 1.6% in after-hours trading to end the day at $33.34.
Last week, MKM Partners analyst Rohit Kulkarni maintained a Hold rating on the stock and raised the price target to $35 from $30 (6.6% upside potential).
After McCarthy took over as CEO of Peloton, Kulkarni, in a research note to investors, said, “The company’s new CEO has a tremendous track record of creating shareholder value, and at-home connected fitness should see a larger market opportunity in the new normal, but the stock is now a show-me story.”
Additionally, Mario Lu of Barclays (NYSE: BCS) reiterated a Buy rating on Peloton and lowered the price target from $90 to $60 (82.8% upside potential).
Lu said, “The new CEO Barry McCarthy seems well-positioned to lead the company through its restructuring process and reshape the business model to be able to grow profitably by the Fiscal Year 2023.”
Overall, the stock has a Moderate Buy consensus rating based on 13 Buys, 9 Holds and 2 Sells. The average Peloton Interactive price target of $47.09 implies 43.4% upside potential. Shares have lost 79.2% over the past year.
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, offers insight into Peloton’s performance.
According to the tool, compared to the previous year, Peloton’s website traffic has registered a nearly 42% decline in global visits year-to-date.
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