Peloton Shares Surge on Analyst Upgrade and Subscription Growth Prospects

Peloton Interactive Inc. (PTON) shares rallied approximately 10% this week following a bullish analyst upgrade from UBS. The fitness company, whose stock has languished since pandemic-era demand faded, now shows signs of stabilizing subscriber metrics and revenue potential from price increases.

Analyst Arpine Kocharian raised her rating to Buy with an $11.50 price target, citing improving traffic data and the financial impact of recent subscription hikes. "We see price increases anchoring near-term growth," Kocharian noted, projecting $90-$100 million in annualized revenue from the adjustments. Her EBITDA forecast of $400-$450 million for fiscal 2026 far exceeds consensus estimates.

At a $2.5 billion market capitalization, the valuation appears compelling for investors betting on Peloton's transition from hardware sales to recurring subscription revenue. While gym reopenings initially crushed demand for its connected fitness equipment, the company's content library and user engagement metrics now suggest a potential inflection point.