Peloton Interactive, Inc. (PTON): A Bull Case Theory 

We came across a bullish thesis on Peloton Interactive, Inc. on Open Insights’s Substack. In this article, we will summarize the bulls’ thesis on PTON. Peloton Interactive, Inc.’s share was trading at $6.66 as of December 1st. PTON’s forward P/E was 12.24 according to Yahoo Finance.

Peloton (PTON) has undergone a major transformation over the past 18 months under new CEO Peter Stern, formerly of Apple, with a sharpened focus on profitability, free cash flow, and a comprehensive strategic overhaul. As FY2026 approaches, PTON unveiled its first-ever product revamp—the Peloton Cross Training Series—featuring AI-assisted workouts, upgraded hardware, enhanced connectivity, and a built-in movement tracking camera. The new line promotes cross-training across multiple modalities while leveraging “Peloton IQ” to personalize health plans.

Beyond enhancing user experience, AI integration could lower localization costs by translating and dubbing content for international markets. The company also restructured its retail model, replacing large stores with smaller mall kiosks and launching “Peloton Repowered” for used equipment. Its commercial arm, Precor, is being repositioned to target gyms, hotels, and corporate clients with the new Peloton Pro Series line.

Stern has repositioned PTON from a fitness brand to a broader “health and wellness” platform, expanding its addressable market. Engagement remains robust, with cancellation rates below Netflix’s, and subscribers using multiple workout types showing far greater retention. PTON also raised hardware and subscription prices by 15–20%, expected to add roughly $160M in EBITDA annually.

Despite conservative FY2026 guidance of $2.5B revenue, $425M EBITDA, and $200M FCF, management plans another $100M in cost cuts, suggesting potential outperformance and significant deleveraging. Though macro headwinds persist, lower expenses, strong brand loyalty, and renewed growth initiatives position Peloton attractively. If Stern can deliver even modest growth, the company’s valuation could re-rate sharply higher.

Previously we covered a bullish thesis on Peloton Interactive, Inc. (PTON) by Open Insights in March 2025, which highlighted improving profitability, cost efficiencies, and strong free cash flow after restructuring. The company’s stock has depreciated about 5.26% since our coverage. The thesis still stands, with Open Insights now emphasizing product innovation, AI integration, and wellness-focused repositioning.

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Disclosure: None.