Shares of Planet Fitness (NYSE:PLNT) are under pressure today after the operator of fitness centers announced its fourth-quarter results. Revenue inched up by 1.4% year-over-year to $285.1 million, which was enough to outpace expectations by $2.7 million. In tandem, EPS of $0.60 exceeded estimates by $0.02.
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In 2023, PLNT put in place a new growth model to drive store growth and lower the capital requirements for opening and maintaining PLNT locations. In Q4, the company’s system-wide same-store sales ticked higher by 7.7%, and adjusted EBITDA expanded by 7.8% to $114.3 million. Further, PLNT opened 77 new stores in Q4, taking its total footprint to 2,575 locations at the end of December 2023. Buoyed by its recently concluded third-party studies, the fitness chain now pegs the total store opportunity in the U.S. at 5,000 versus its estimate of 4,000 stores in 2015.
For Fiscal Year 2024, PLNT anticipates system-wide same-store sales growth in the 5% to 6% bracket. While revenue is expected to rise in the 6% to 7% range, adjusted EPS is seen expanding by 10% to 11%. Separately, PLNT announced the departure of its CFO, Tom Fitzgerald. Nevertheless, Mr. Fitzgerald plans to remain with PLNT until the end of August while the company hones in on a new candidate.
What Is the Target Price for PLNT Stock?
Shares of the company have declined by nearly 19% over the past year. Overall, the Street has a Moderate Buy consensus rating on Planet Fitness, and the average PLNT price target of $83.50 implies a 30.4% potential upside in the stock. However, analysts’ views on the stock could see revisions following its earnings report today.
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