5 Best Fitness and Gym Stocks To Buy Now

3. Peloton Interactive, Inc. (NASDAQ:PTON)

Number of Hedge Fund Holders: 41

Peloton Interactive, Inc. (NASDAQ:PTON) provides an interactive fitness platform in North America and globally. The company’s product line includes connected fitness equipment such as Peloton Bike, Peloton Bike+, Peloton Tread, and Peloton Tread+, which come equipped with touchscreens that allow users to stream live and on-demand fitness classes. It is one of the premier fitness stocks to invest in. 

According to a research note by JMP Securities dated March 21, Peloton Interactive, Inc. (NASDAQ:PTON) has been found to represent 1% of unit sales but 19% of sales revenue for exercise bikes on Amazon, based on their analysis of the top 50 best-selling products in this category. This “rough estimate” suggests that Peloton Interactive, Inc. (NASDAQ:PTON)’s position in the market is improving post-COVID. The firm noted that Peloton continues to provide an excellent customer experience and hardware product, but they prefer to wait for more certainty that the exercise bike category has stabilized before recommending the shares.

According to Insider Monkey’s fourth quarter database, 41 hedge funds were bullish on Peloton Interactive, Inc. (NASDAQ:PTON), compared to 45 funds in the prior quarter. Anand Desai’s Darsana Capital Partners is the biggest position holder in the company, with 10 million shares worth $79.4 million. 

Here is what Merion Road Capital specifically said about Peloton Interactive, Inc. (NASDAQ:PTON) in its Q3 2022 investor letter:

“Peloton Interactive, Inc. (NASDAQ:PTON) is quite a different story. You may recall from my Q1 letter that I initiated a position in the stock given the potential for a new CEO to leverage the company’s passionate and engaged user base. The investment had meaningful upside potential (multiples of the then trading price), but also presented real downside risk; as such, I kept our exposure to just a few percentage points of the portfolio. Fast forward six months and underlying trends like churn, engagement, and new users weakened dramatically. I sold our shares as the likelihood for the company to achieve financial success has become increasingly remote.”