| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 59 | 35.4x | 17.8x | Around median | |
Growth | 34 | -1.8% | 7.1% | Bottom tier | |
Quality | 91 | 11.0% | 4.5% | Top tier | |
Safety | 30 | 7.0x | 2.6x | Bottom tier | |
Capital Return | 93 | — | 2.12% | Top tier | |
Momentum | 39 | -17.6% | 2.9% | Bottom tier | |
Sentiment | 43 | 14 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Peloton Interactive has evolved from a connected fitness company into an ecosystem targeting fitness and wellness. Its model is based on selling Bike, Tread, and Row equipment and Precor products, then generating recurring revenue from Connected Fitness subscriptions and training content. The company combines hardware, software, instructors, and a digital community, while expanding access channels through gyms, hotels, small-format stores, retail partners, and Spotify. At the end of Q4 FY2026, paid Connected Fitness subscriptions totaled 2.553 million, and 316 thousand members owned more than one connected device.
In Q4 FY2026, revenue reached $608 million, exceeding the high end of the implied guidance range by $6 million, and achieved slight year-over-year growth supported by sales of Peloton and Precor equipment. Gross profit was $344 million, up $16 million or 5% year over year, and gross margin increased 260 basis points to 56.7%. Adjusted EBITDA was also $142 million, or 23% of revenue, while the earnings report showed earnings per share of $0.13.
For FY2026, Peloton recorded its first full year of positive net income and operating income, at $63 million and $161 million, respectively. Adjusted EBITDA reached $468 million, up 16%, and free cash flow reached $378 million, up 17%. The business mix reflects a growing role for the commercial unit, which recorded double-digit year-over-year growth and generates higher prices and margins than consumer equipment, alongside high-margin subscriptions and recurring revenue.
Automated analysis for informational purposes only — not investment advice.
The average analyst price target for PTON is $6, which is also both the highest and lowest target, with the consensus rated “Buy”; therefore, the target range provides no dispersion that can be used to measure differences in opinion. This target is below the 52-week range high of $9.20 and above its low of $3.65, while no usable price-to-earnings ratio is available despite the company's shift to annual net income of $63 million in FY2026. The valuation reflects a balance between improved margins and cash flow on one hand, and the expected 3.9% decline in FY2027 revenue at the midpoint and falling subscriptions on the other.
Figures in the text are as of 2026-09-01; the live price is shown at the top of the page.
Peloton achieved net income of $63 million and operating income of $161 million in FY2026. Adjusted EBITDA reached $468 million, up $65 million or 16% year over year. The turnaround came after exceeding the annual cost-savings target of $100 million and reducing adjusted operating expenses in Q4, excluding the nonrecurring legal provision, by $29 million or 11% year over year. Free cash flow for FY2026 also increased 17% to $378 million.
The company expects revenue of between $2.3 billion and $2.4 billion in FY2027, down 3.9% year over year at the midpoint. Part of the comparison is attributable to the fading nonrecurring benefit from previous subscription price increases. In contrast, Peloton expects gross margin to increase by approximately 140 basis points to nearly 54%, and adjusted EBITDA to reach $475–525 million. Therefore, the expected earnings increase depends more on improving margins and reducing expenses than on revenue growth.
More than 50% of monthly active users engaged with Peloton IQ-powered guidance in Q4 FY2026. The system provides between three and five weekly insights, while Cross-Training Series Plus equipment offers form correction, repetition counting, and adaptive training through camera vision technologies. Management stated that Peloton IQ has become the feature attracting the most interest from prospective customers, according to its research. The company is also working to expand goal personalization and integrate data from more wearable devices following Apple, Google, and Garmin integrations.
The commercial unit recorded double-digit year-over-year growth in FY2026 across regions and major product categories, although Peloton's estimated share remains approximately 4% of the commercial fitness equipment market. The company plans to launch a commercial Bike and treadmill designed for intensive usage cycles before the end of 2026. Management says commercial equipment generates higher prices, revenue, and margins per sale than residential equipment, with an additional subscription component for Peloton equipment. Accelerating growth in this unit has already been incorporated into the FY2027 outlook.
Peloton ended Q4 FY2026 with 2.553 million paid Connected Fitness subscriptions, down 8.8% year over year. The net cancellation rate was 2.2%, up 37 basis points, with approximately 17 basis points of the increase related to temporary factors, most notably a change to the payment reactivation algorithm. The company restored the previous payment recovery flow and said involuntary cancellations had begun returning to normal levels. Nevertheless, it expects between 2.455 million and 2.475 million subscriptions in Q1 FY2027, down 9.8% at the midpoint, and expects the annual cancellation rate for FY2027 to remain approximately stable compared with FY2026.
The company recorded a legal provision of $23.8 million in Q4 FY2026 following a ruling related to a patent used in third-party media players. It included the same amount in the minimum free cash flow target for FY2027 of $350 million, while confirming that potential ongoing royalties are not expected to be material. Financially, liquidity reached $1.21 billion and net debt was $93 million at the end of the quarter, after repaying $200 million of debt in Q3 FY2026. Peloton began a refinancing process aimed at reducing the cost of capital and increasing flexibility, without announcing final terms during the August 6, 2026 call.
