Home BUSINESS More than $ 10 billion has been lost from Peloton’s market capitalization...

More than $ 10 billion has been lost from Peloton’s market capitalization since the unfavorable earnings report

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Peloton bicycle

Shennon Stapleton |

About $ 10.4 billion of Peloton’s market capital has been wiped out since last Thursday’s doubts about the fitness company’s future growth prospects.

Shares closed at $ 51.25 on Monday, down 7.9%, extending the previous week’s losses. The stock traded at a 52-week low of $ 49.11.

Monday’s stock change came after a Wall Street research firm downgraded Argus, which downgraded its rating to keep it from buying.

In a note to customers, analyst John Staszak said Peloton will face a number of challenges next year as competition from gyms networks and other affiliated fitness companies makes it difficult for Peloton to expand its subscriber base. Rising costs will also raise red flags, he said.

“As the company invests in marketing and new products, we expect higher costs,” Staszak writes. “In addition, higher entry costs and increased shipping costs should affect the results.”

Peloton does not expect to be profitable again until 2023. The company recently reduced the price of the original cycle, called Bike, by 20 percent. This hit him in favor because he makes less money from the sale. Peloton is also still recovering from the memory of the treadmill and has stepped up marketing to raise awareness about the recently redesigned Treadmill.

Shares fell 35 percent on Friday, the same day the company suspended temporary hiring in all departments. At least 15 analysts cut their stock price before the weekend after Peloton cut its full-year financial forecast.

With its stock rising more than 440% in 2020, Peloton’s market capitalization was about $ 45 billion to start the year. It is now valued at $ 15.4 billion and shares have fallen 66 percent year-over-year.

of Michael Bloom contributed to this report.

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