UBS Maintains Neutral on Peloton, Sees Modest EBITDA Growth by FY 2026

UBS analyst Arpine Kocharyan maintained a Neutral rating for Peloton Interactive, Inc. (NASDAQ:PTON) with a consistent price target of $7.50 as of May 27.  Although the firm projects modest revenues in fiscal year 2026, its assessment comes amid forecasts of slightly increased underlying EBITDA, driven by cost savings this year.

According to UBS, Peloton’s FY’26 EBITDA is expected to reach $365 million, a slight improvement from the $353 million that was previously projected.  The firm also updated its FY’27 EBITDA projection, which was previously $364 million, to $377 million.

Peloton Interactive, Inc.’s (NASDAQ:PTON) increased its Free Cash Flow guidance from the initial estimate of “at least” $200 million to $250 million, which is reflected in the updated financial outlook.  Although the company’s current ratio of 1.65 indicates that it has healthy liquidity, UBS warns that the growth rate in FCF for fiscal year 2026 is anticipated to be much slower than that of this year.  The new estimate was made under the assumption that the working capital gains observed in fiscal year 2025 are unlikely to be repeated the next year.

Peloton Interactive, Inc. is an American exercise equipment and media company that offers products including static bikes, treadmills, and indoor rowers with Internet-connected touch displays that stream live and recorded fitness courses via a subscription service.

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