Planet Fitness on Growth Path: Analysts Optimistic Despite Market Fluctuations

Planet Fitness shares experienced a notable increase of 4.9% during the morning session after TD Cowen reaffirmed its buy recommendation and set the price target at $135. According to the investment firm, the fitness chain is currently experiencing "very strong gross additions and improved fundamentals," although these successes are overshadowed by unexpectedly high cancellation rates. Despite this challenge, Planet Fitness remains TD Cowen's "top idea," as a "strong catalyst path" is seen. Confidence in the new management's turnaround plan seems firmly rooted, with the analysts' positive assessment outweighing the general market uncertainty caused by conflicting statements from Federal Reserve officials. Initially, the shares rose sharply but then cooled down to $103.88, representing a gain of 4.6% compared to the previous day. In this context, the question arises whether now is the right time to invest in Planet Fitness. Over the past twelve months, stock fluctuations rarely exceeded 5%, making today's movement all the more significant—even if it is not considered fundamental to the business outlook. Thirteen days ago, the shares recorded a 2.5% increase following the anticipated release of the Consumer Price Index (CPI), which heightened hopes for a Federal Reserve interest rate cut. The inflation rate for August was 2.9% annually, with core inflation stagnating at 3.1%. These figures were not considered high enough on Wall Street to prevent an expected interest rate cut at the central bank's next meeting, which triggered a broad rally in US stock markets. Since the beginning of the year, Planet Fitness is up 4.5%. At a price of $103.88, the stock is trading close to its 52-week high of $113.55. Investors who invested $1,000 in Planet Fitness five years ago would see a value of $1,752 today.