24/7 Wall St. Insights
- Peloton Interactive Inc. (NASDAQ: PTON) shares surged after its earnings beat.
- However, the company still lacks a way forward toward major revenue growth and profits.
- Also: Dividend legends to hold forever.
Peloton Interactive Inc. (NASDAQ: PTON) released barely good earnings for the first time in years. Its shares rallied but are still down 82% over five years. The truth is that Peloton’s products are too expensive, it has too much competition, and it remains very small in terms of revenue.
Bloomberg reported, “Peloton Interactive Inc. shares surged the most ever after the fitness company reported earnings that beat analysts’ estimates, signaling that turnaround efforts are starting to bear fruit.” However, its revenue rose only 0.2% year over year to $644 million. The company posted a loss of $30 million, compared to a loss of $211 million in the same quarter a year ago. A loss is a loss. Until Peloton can prove its losses have turned to profits, there is little to cheer.
Members, perhaps the primary metric for Peloton, dropped 2% to 6.4 million. Once again, bad news is bad news. Connected fitness product revenue dropped 4%. One of the headlines of the earnings release was about its sales to businesses. The primary example of this was a new agreement with YMCA in Chicago.
Finally, guidance for the next quarter was particularly weak. Peloton continues to lack a way forward toward major revenue growth and profits.
The company will not be turned around for at least one major reason. It has too much competition with lower prices. Below the Peloton equipment products at Amazon (which Peloton paid for, so it does not show how Amazon would have listed it under normal circumstances) are several products that get very good reviews from Amazon users. These include products from Merach, Vanswe, Wenoker, and Yosuda. The Peloton bike for sale costs $2,495. The others are under $300.
Is Peloton equipment better than its competition? If so, it is not better enough to fuel any growth.
Avoid All Outdoor Clothing Brands Except These 12
Credit Card Companies Are Doing Something Nuts
Credit card companies are at war. The biggest issuers are handing out free rewards and benefits to win the best customers.
It’s possible to find cards paying unlimited 1.5%, 2%, and even more today. That’s free money for qualified borrowers, and the type of thing that would be crazy to pass up. Those rewards can add up to thousands of dollars every year in free money, and include other benefits as well.
We’ve assembled some of the best credit cards for users today. Don’t miss these offers because they won’t be this good forever.
Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.