Planet Fitness weakness an ‘incremental buying opportunity,’ says Guggenheim

Guggenheim lowered the firm’s price target on Planet Fitness to $77 from $82 and keeps a Buy rating on the shares. Yesterday’s 5% decline, which brought the year-to-date selloff to 15% was “somewhat surprising” and likely due to a combination of a “tepid” 5-6% 2024 comp growth outlook, pricing initiative uncertainty and the unexpected retirement of CFO Tom Fitzgerald, the analyst tells investors. However, the firm regards the weakness as “an incremental buying opportunity,” citing its view that near-term expectations have now been more completely derisked, that the new model is likely to drive a multi-year acceleration in operating momentum from the 2024 bottom and that a forthcoming new CEO announcement should “serve as an important catalyst.”