On Tuesday, TD Cowen maintained a positive outlook on Planet Fitness (NYSE:PLNT) shares, reiterating a Buy rating with a steady price target of $120.00. The stock, which has gained an impressive 34.74% over the past six months according to InvestingPro data, is currently trading near its 52-week high.
Analysts at the firm highlighted the company's performance, noting that key metrics for the fourth quarter were largely as anticipated. The team at TD Cowen expressed optimism following the recent appointments of a new Chief Marketing Officer and Chief Development Officer.
Planet Fitness ended the fiscal year with 19.7 million members, marking an increase of 100,000 members from the previous quarter. System-wide comparable sales for the fiscal year 2024 rose by 5.0%, with the fourth quarter figures aligning with the upper end of the guidance range.
The company maintains impressive gross profit margins of 60.33% and boasts a GREAT financial health score on InvestingPro, which offers 13 additional valuable insights about the company's performance. The company's gym openings for the fiscal year reached 150, which was at the high end of the forecast, including 86 new gyms in the fourth quarter, out of which 77 were franchise locations.
The appointments of Chip Ohlsson as Chief Development Officer, effective January 20, and Brian Povinelli as Chief Marketing Officer, effective February 10, were well-received by analysts. These strategic additions are seen as a completion of key C-suite roles under the leadership of Ms. Keating.
TD Cowen's analysis also mentioned encouraging signs from key performance indicators following the Classic Card price increase, including improved membership additions, reduced churn rates, and robust growth in the Black Card mix.
The firm believes that franchise economics are looking healthier and anticipates a sequential improvement in openings over the next few years, with expectations for Planet Fitness to reach over 200 new gyms annually.
With revenue growth forecast at 16% for FY2024, the company's expansion plans appear well-supported. Discover comprehensive valuation metrics and growth potential analysis in the detailed Pro Research Report, available exclusively on InvestingPro.
In other recent news, Planet Fitness has reported notable membership growth and club expansion, with a positive revenue growth forecast of 16% for fiscal year 2024. The company has also announced significant executive appointments, with Chip Ohlsson and Brian Povinelli stepping in as Chief Development Officer and Chief Marketing Officer, respectively. These appointments are part of the company's ongoing efforts to reinforce its market position.
Additionally, Planet Fitness has been the subject of positive outlooks from financial firms, with RBC Capital and TD Cowen maintaining optimistic stances on the company's shares. Both firms have increased their price targets for Planet Fitness to $120, citing the company's strategic adjustments and pricing strategy as key factors for potential growth.
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