UBS upgraded Peloton (PTON) to Neutral from Sell with a price target of $10, up from $2.50. The firm sees the company’s EBITDA being supported from further cost cutting beyond the announced $200M, driven mostly by lower operating expenditures. Expectations have been reset to little to no growth over the next two years and the new CEO transition offers a chance to “further reset the bar against buy-side expectations that are more reasonable now,” the analyst tells investors in a research note. UBS also likes that Peloton’s CEO compensation package is tied to revenue and operating income and EBITDA and free cash flow performance.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
