Peloton gets a boost after great quarter and Lululemon struggles but the future may be bright
The exercise equipment company reported 172% sales growth in its earnings report yesterday after demand spiked for at home exercise equipment during the height of coronavirus lockdowns. The company’s stock price went up 10% in after-hours trading following the announcement.
One of the keys to Peloton’s great quarter was the ability to keep existing customers. An important revenue stream is their connected fitness monthly subscription, which has been very successful at keeping customers. Maintaining these customers in a post-lockdown world will be very important for Peloton’s future.
The clothing company’s stock price dropped more than 7% Wednesday despite an impressive earnings report the previous night. The company reported 157% year-over-year growth in online sales showing its great response to the pandemic.
A reason for the decline despite the good report is the amount of momentum around the company recently. Despite the drop, its price is still up 130% since the middle of March, and the company continues to have a very strong brand. Some analysts believe this dip is the time to buy Lulu because a buyer is getting into a great company at a discount.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.