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1. Company Snapshot

1.a. Company Description

Planet Fitness, Inc., together with its subsidiaries, franchises and operates fitness centers under the Planet Fitness brand.It operates through Franchise, Corporate-Owned Stores, and Equipment segments.The Franchise segment is involved in franchising business in the United States, Puerto Rico, Canada, Panama, Mexico, and Australia.


The Corporate-Owned Stores segment operates corporate-owned stores in the United States and Canada.The Equipment segment engages in the sale of fitness equipment to franchisee-owned stores in the United States and Canada.As of December 31,2021, the company had 2,254 stores in 50 states, the District of Columbia, Puerto Rico, Canada, Panama, Mexico, and Australia.


Planet Fitness, Inc.was founded in 1992 and is headquartered in Hampton, New Hampshire.

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1.b. Last Insights on PLNT

Planet Fitness' recent performance has been impacted by several factors. Despite a 6.9% increase in system-wide same club sales and a raise in 2025 full-year growth outlook, the company's stock has faced selling pressure. The firm's Q3 earnings beat estimates with $0.8 per share, exceeding the Zacks Consensus Estimate of $0.72 per share. A share buyback of approximately $100M has been executed, reducing outstanding shares. According to Zacks, the stock has been upgraded to a Buy rating, citing growing optimism about earnings prospects. Cwm LLC has reduced its stake in the company by 15.1%.

1.c. Company Highlights

2. Planet Fitness Delivers Strong Q3 Results

Planet Fitness reported a robust financial performance in Q3, with total revenue growing 13% year-over-year. The company's EPS came in at $0.8, beating analyst estimates of $0.72. The strong top-line growth was driven by same club sales growth of 6.9%, fueled by rate growth and net membership growth. As Jay Stasz mentioned, the company saw revenue growth across all three segments, with equipment segment revenue increasing 27.8%. The company's ability to drive growth through a combination of rate and volume is a testament to its successful business model.

Publication Date: Nov -13

📋 Highlights
  • Strong Financial Performance:: 6.9% same club sales growth driven by rate increase and net membership growth, with 35 new clubs added, totaling 2,795 globally and 20.7 million members.
  • High School Summer Pass Impact:: 3.7 million teens completed 19 million free workouts, highlighting engagement with younger demographics.
  • Marketing Strategy Shift:: Increased focus on TikTok and influencer campaigns, with $50 million reallocated to digital marketing, AI, and CRM optimization from the national ad fund.
  • Black Card Growth and Pricing:: 66.1% Black Card penetration, smallest price gap between tiers, with a planned $29.99 price increase post-2026 peak join season.
  • Expansion and Revenue Growth:: 13% total revenue growth, 27.8% equipment segment increase, and 160–170 new club openings planned in Q4, aiming for 5,000 U.S. clubs long-term.

Segment Performance

The company's franchise segment saw same-club sales growth of 7.1% in Q3, with accelerating license sales and interest in new licenses. This growth is a positive indicator of the company's ability to expand its franchise base. The equipment segment also saw significant revenue growth, driven by the increasing demand for the company's high-grade equipment.

Strategic Imperatives

Planet Fitness continued to make progress on its four strategic imperatives: redefining the brand promise, enhancing the member experience, refining the product, and optimizing the format. The company is confident in its ability to drive growth through its strategic initiatives, including the successful High School Summer Pass program, which has seen 3.7 million teens complete over 19 million free workouts.

Valuation Metrics

Using the current valuation metrics, we can assess what's priced into the stock. The P/E Ratio stands at 42.11, indicating that the stock may be slightly overvalued. However, the EV/EBITDA ratio of 15.76 suggests that the company's enterprise value is reasonable relative to its earnings. The P/S Ratio of 6.76 also indicates that the stock is not excessively valued relative to its revenue. With analysts estimating revenue growth at 10.4% next year, the current valuation may be justified.

Growth Prospects

The company is optimistic about its growth prospects, with plans to open between 160 and 170 new clubs in Q4 and complete 130 to 140 equipment placements in new franchise clubs. The company's global expansion opportunity is also significant, with success in Spain and potential for growth in other countries. As Colleen Keating mentioned, the company plans to share more details about its global expansion plans at the Analyst Day next week.

3. NewsRoom

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KBRA Assigns Preliminary Ratings to Planet Fitness Master Issuer LLC, Series 2025-1

Dec -02

Source: businesswire.com

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Planet Fitness Powers Boys & Girls Clubs of America's GivingTuesday Campaign with Dollar-for-Dollar Match to Support Youth Wellbeing

Dec -01

Source: globenewswire.com

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Planet Fitness, Inc. Announces Proposed Refinancing Transaction

Dec -01

Source: prnewswire.com

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Planet Fitness: Aggressive Growth Targets Through FY 2028

Nov -29

Source: seekingalpha.com

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24,145 Shares in Planet Fitness, Inc. $PLNT Bought by Advantage Alpha Capital Partners LP

Nov -28

Source: defenseworld.net

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Peloton vs. Planet Fitness: Which Fitness Stock Has Stronger Upside?

Nov -26

Source: zacks.com

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American Century Companies Inc. Purchases 134,358 Shares of Planet Fitness, Inc. $PLNT

Nov -26

Source: defenseworld.net

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Planet Fitness Banks on Strategic Initiatives Amid High Attrition

Nov -25

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.62%)

6. Segments

Corporate-owned Stores

Expected Growth: 9%

Planet Fitness' corporate-owned stores growth is driven by strategic location expansion, increased brand awareness, and effective marketing campaigns. Additionally, the company's Judgement Free Zone philosophy, affordable membership options, and high-value amenities attract a loyal customer base, contributing to the 9% growth rate.

Franchise

Expected Growth: 7%

Planet Fitness' franchise growth is driven by increasing demand for affordable fitness options, strategic partnerships, and expansion into new markets. The Judgement Free Zone brand resonates with consumers, while the low-cost, high-volume model attracts franchisees. Additionally, the company's focus on technology integration and digital marketing enhances the member experience, fueling growth.

Equipment

Expected Growth: 6%

Planet Fitness' equipment segment growth is driven by increasing demand for high-quality, affordable fitness equipment, strategic partnerships with fitness influencers, and expansion into new markets. Additionally, the company's Judgement-Free Zone philosophy and focus on providing a welcoming environment for members contribute to growth. Furthermore, investments in digital technology and data analytics enhance the overall member experience, driving equipment sales and retention.

7. Detailed Products

Membership

Planet Fitness offers various membership plans that provide access to its fitness centers, equipment, and amenities.

PF360

PF360 is a premium membership tier that offers additional amenities, including access to exclusive equipment, personalized fitness coaching, and discounts on certain services.

Small Group Training

Planet Fitness offers small group training sessions led by certified trainers, focusing on strength training, cardio, and flexibility exercises.

Personal Training

Planet Fitness offers one-on-one personal training sessions with certified trainers, tailored to individual fitness goals and needs.

Fitness Classes

Planet Fitness offers a variety of group fitness classes, including yoga, Pilates, and cardio-based workouts.

Equipment and Amenities

Planet Fitness gyms are equipped with a range of cardio and strength training equipment, as well as amenities like hydromassage beds, tanning services, and free Wi-Fi.

8. Planet Fitness, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Planet Fitness has a low threat of substitutes due to its unique Judgement Free Zone atmosphere and affordable membership prices, making it difficult for substitutes to replicate.

Bargaining Power Of Customers

Planet Fitness has a medium bargaining power of customers due to the availability of alternative fitness centers and gyms, but its low prices and convenient locations mitigate this power.

Bargaining Power Of Suppliers

Planet Fitness has a low bargaining power of suppliers due to its ability to negotiate with equipment manufacturers and its large scale of operations.

Threat Of New Entrants

Planet Fitness has a medium threat of new entrants due to the relatively low barriers to entry in the fitness industry, but its established brand and economies of scale make it difficult for new entrants to compete.

Intensity Of Rivalry

Planet Fitness operates in a highly competitive fitness industry with many established players, leading to a high intensity of rivalry among competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 106.08%
Debt Cost 5.03%
Equity Weight -6.08%
Equity Cost 10.80%
WACC 4.67%
Leverage -1744.59%

11. Quality Control: Planet Fitness, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Hasbro

A-Score: 5.6/10

Value: 5.7

Growth: 3.0

Quality: 4.1

Yield: 8.0

Momentum: 6.0

Volatility: 7.0

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United Parks & Resorts

A-Score: 5.3/10

Value: 7.6

Growth: 6.9

Quality: 6.3

Yield: 0.0

Momentum: 6.0

Volatility: 5.3

1-Year Total Return ->

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Planet Fitness

A-Score: 5.1/10

Value: 3.3

Growth: 6.7

Quality: 5.8

Yield: 0.0

Momentum: 7.5

Volatility: 7.7

1-Year Total Return ->

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YETI

A-Score: 4.6/10

Value: 5.1

Growth: 8.1

Quality: 7.6

Yield: 0.0

Momentum: 2.5

Volatility: 4.0

1-Year Total Return ->

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Mattel

A-Score: 4.4/10

Value: 6.0

Growth: 5.1

Quality: 6.3

Yield: 0.0

Momentum: 3.5

Volatility: 5.3

1-Year Total Return ->

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Six Flags

A-Score: 3.6/10

Value: 7.5

Growth: 2.2

Quality: 3.4

Yield: 1.0

Momentum: 5.0

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

111.08$

Current Price

111.08$

Potential

-0.00%

Expected Cash-Flows