Update - In the last two weeks, the market has seen large amounts of money leave the stocks that benefitted during covid to names that should benefit during a re-opening of the economy. One casualty of this has been Peloton, which has seen its stock drop by almost 30% from its highs. Like Freshpet, Peloton has suffered from capacity issues. The growing brand has had such strong demand that waiting times for its products have increased. They continue to expand their production capacity, in particular looking to expand production within the US (home factories). They acquired Precor for $420m. Precor is an incumbent in the market that offers gym equipment across a large range of commercial properties (think hotels, etc). Through the purchase of Precor, Peloton will get access to 625,000 square feet of manufacturing capacity within the US. They will also offer the Peloton experience across the commercial sites (exactly how, more details to be supplied).
In the meantime, Peloton has continued to announce excellent growth numbers. Total revenue grew 128% and is now over $1b for the quarter. Connected subscriptions grew 134%. Churn held at 92%. Average monthly workouts of 21.1. Whilst this company may see some slowing down as gyms re-open, it has capitalised on the opportunity it was given and grown its brand and community significantly. Even with the 30% decline, the company is still up 55% from when I first mentioned it in edition 7 of the newsletter (6th September). So this stock is still in an uptrend over the course of the year. If this stock was on your watchlist, the current dip might be an interesting buying opportunity if you have a long-term mindset.