Planet Fitness
PLNT
$55.03
-1.11%
Planet Fitness, Inc. is a franchisor and operator of fitness centers, generating revenue through three reportable segments — Franchise royalties and fees, Corporate-owned stores, and Equipment sales to franchisees — across the United States, Puerto Rico, Canada, Panama, Mexico, and Australia, with the corporate-owned store segment contributing the majority of revenue. The company is a category-defining player in the high-value, low-price (HVLP) fitness niche, distinguished by its 'Judgement Free Zone' brand positioning, a highly franchised, capital-light model, and a membership base that skews casual and value-conscious rather than fitness-enthusiast. The current investor narrative is dominated by a severe de-rating: shares have collapsed roughly 40% over the past year and over 51% year-to-date, with a violent single-day gap lower in early May 2026 (from $63.96 to $44.01) and another sharp drop in early August, suggesting a guidance reset or demand shock that has reframed the stock from a premium compounder to a show-me turnaround. Bulls point to resilient 7.1% revenue growth, a 16.5% net margin, and a forward PE near 14.6x as evidence the sell-off is overdone, while bears focus on decelerating membership growth, rising interest expense, and a deeply negative equity position that complicates the balance-sheet story.…
PLNT
Planet Fitness
$55.03
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Investment Opinion: Should I buy PLNT Today?
Rating: Hold (with a constructive, catalyst-dependent bias toward Buy). The core thesis is that PLNT's operating engine remains intact — 46.5% EBITDA margins, $261.7 million of TTM free cash flow, and 7.14% revenue growth — while the stock has been repriced to 14.64x forward EPS of $6.72, a multiple that already discounts stagnation; the problem is that no catalyst has yet proven the membership reacceleration needed to close the gap to the $65.58 average analyst target (+22.4% upside) despite a consensus Buy rating (mean 1.88 across 16 analysts).
Supporting evidence is genuinely two-sided but tilts modestly positive on valuation. The forward PE of 14.64x sits against a trailing PE of 41.4x and historical readings of 48.3x in Q1 2025 and 44.1x in Q4 2024, while the PS ratio of 6.84x is roughly a quarter of the 26.9x seen in mid-2025 — the de-rating is largely done. Profitability is not deteriorating: Q2 2026 net income of $67.1 million on a 16.5% net margin and 33.9% operating margin compares favorably to Q2 2025's $58.0 million, and EBITDA rose to $169.7 million from $148.5 million. Free cash flow of $261.7 million TTM against a $4.03 billion market cap implies roughly a 6.5% FCF yield, and the PEG of 1.36 is undemanding for a mid-single-digit grower. The offset is that interest expense of $33.4 million consumed about 27% of Q2 operating income, up 27.6% year-over-year, and the $49.20 low target implies -8.2% downside if deceleration persists.
Three risks could invalidate the thesis: a renewed membership deceleration that pushes revenue growth below 5%, further interest expense creep on a balance sheet with negative shareholders' equity (debt-to-equity of -6.00) and only ~3.7x interest coverage, and a failure to hold the $56-57 technical resistance that would confirm a lower-high structure. This Hold would upgrade to Buy on a decisive break above $57 accompanied by membership growth reacceleration and any analyst upgrade (none have occurred — only reiterations and B of A's May 2026 downgrade to Neutral), and would downgrade to Sell on a Q3 guidance cut or a close below the $40.50 September shelf. Verdict: fairly valued to modestly undervalued relative to its own history, but not yet proven cheap enough to be a high-conviction Buy.
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PLNT 12-Month Price Forecast
PLNT is a high-quality franchise model trading at a low-end multiple after a -51.17% YTD collapse and a -63.83% max drawdown, and the 26.91% one-month bounce off the $40.50 low shows positioning is washed out. The bull case rests on 14.64x forward earnings against 46.5% EBITDA margins and $261.7 million of TTM free cash flow, with a $65.58 consensus target implying +22.4% upside; the bear case rests on 7.14% revenue growth that has decelerated from double digits, interest expense up 27.6% year-over-year, and the absence of any upgrade to validate the turn. The tight $6.40-$7.00 EPS cluster versus the 2x-wide target range means the next earnings print, not multiple expansion, will decide the direction. I would upgrade to bullish on a decisive break above $57 resistance paired with membership reacceleration and an analyst upgrade, and downgrade to bearish on a Q3 guidance cut or a close below the $40.50 shelf.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Planet Fitness's 12-month outlook, with a consensus price target around $65.58 and implied upside of +19.2% versus the current price.
Average Target
$65.58
17 analysts
Implied Upside
+19.2%
vs. current price
Analyst Count
17
covering this stock
Price Range
$49 - $106
Analyst target range
Coverage is robust, with 16 analysts and a consensus recommendation of 'Buy' (mean rating of 1.88 on a 1-5 scale where 1 is Strong Buy). The average target price is $65.58, implying roughly +22.4% upside from the current $53.58. The distribution of recent institutional ratings skews bullish — RBC Capital (Outperform), JP Morgan (Overweight), UBS (Buy), Wells Fargo (Overweight), KeyBanc (Overweight), Guggenheim (Buy), Canaccord (Buy), and Roth (Buy) — with only Morgan Stanley (Equal Weight) and B of A Securities (Neutral, downgraded from Buy in May 2026) sitting on the sidelines. The consensus is clearly bullish, but the B of A downgrade and Morgan Stanley's neutral stance suggest conviction is not uniform.
The target range is extremely wide — from a low of $49.20 (roughly -8% downside) to a high of $106.00 (roughly +98% upside) — a spread of more than 2x that signals very high uncertainty and divergent views on the company's trajectory. The high target likely assumes a successful turnaround with membership growth reaccelerating, margin expansion, and multiple re-rating back toward historical levels; the low target prices in continued deceleration, margin compression from rising interest costs, and a persistent de-rating. Notably, the consensus EPS estimate of $6.72 (range $6.40-$7.00) and revenue estimate of $1.98 billion are tightly clustered, meaning analysts agree on near-term fundamentals but disagree violently on the appropriate multiple — a classic setup for high volatility around earnings. With no recent upgrades visible in the ratings log (only reiterations and one downgrade), the burden of proof remains on the company to deliver a catalyst that closes the gap between the $49 low and $106 high.
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Bulls vs Bears: PLNT Investment Factors
The bear evidence currently carries more weight: a -51.17% YTD decline, a -63.83% max drawdown, a 27.6% jump in interest expense, and decelerating 7.14% revenue growth describe a stock that has been repriced for stagnation, and the absence of any recent upgrade means the company has not yet proven the turn. The bull case is nonetheless substantive — 46.5% EBITDA margins, $261.7 million of TTM free cash flow, a 14.64x forward PE near the bottom of its historical band, and a consensus Buy with a $65.58 average target implying +22.4% upside. The single most important tension is whether membership growth reaccelerates enough to justify a multiple re-rating from 14.6x forward earnings back toward the high-teens or low-20s; if it does, the $106 high target is reachable, but if deceleration persists, the $49.20 low target becomes the gravity point. Near-term technicals (a 26.9% one-month bounce into $56-57 resistance) suggest the easy money from the oversold condition has been made, and the next decisive move depends on the Q3 print rather than multiple expansion alone.
Bullish
- Forward PE of 14.6x prices in stagnation: At $53.58, PLNT trades at 14.64x consensus FY EPS of $6.72, versus a trailing PE of 41.4x and historical PE readings of 48.3x in Q1 2025 and 44.1x in Q4 2024. The PS ratio of 6.84x is roughly a quarter of the 26.9x seen in mid-2025, meaning the market has already de-rated the stock to a level that assumes little or no growth — a low bar for a positive surprise.
- Analyst consensus Buy with 22% upside: All 16 covering analysts have a mean rating of 1.88 (Buy), with an average target of $65.58 implying +22.4% upside from $53.58. Eight institutions — RBC, JP Morgan, UBS, Wells Fargo, KeyBanc, Guggenheim, Canaccord and Roth — carry Outperform/Buy ratings, and the high target of $106 implies +98% upside if the turnaround executes.
- Elite unit economics with 46.5% EBITDA margin: Q2 2026 EBITDA was $169.7 million on $365.2 million of revenue, a 46.5% EBITDA margin, with a 33.9% operating margin and 16.5% net margin. These are premium-franchise economics that remain intact despite the share-price collapse, and TTM free cash flow of $261.7 million still funds aggressive buybacks.
- Revenue still growing 7.1% YoY: Q2 2026 revenue of $365.2 million grew 7.14% from $340.9 million in Q2 2025, and the franchise segment contributed $102.9 million with equipment sales at $85.6 million. Growth has decelerated but has not turned negative, so the bear case rests on multiple compression rather than a broken business model.
Bearish
- Catastrophic 51% YTD decline and -63.8% drawdown: PLNT is down 51.17% year-to-date and 40.45% over the trailing year versus the S&P 500's +10.8%, a relative strength of -51.25% over 12 months. The maximum drawdown of -63.83% and a violent single-day gap from $63.96 to $44.01 on May 7, 2026 signal a fundamental repricing, not a sentiment wobble.
- Interest expense up 27.6% YoY eating earnings: Q2 2026 interest expense rose to $33.4 million from $26.2 million a year earlier, a 27.6% increase that cut pre-tax income to $96.1 million from $83.2 million despite higher operating income. Interest coverage of roughly 3.7x leaves limited cushion if rates stay elevated or debt is refinanced at higher coupons.
- Negative equity distorts every balance-sheet metric: Debt-to-equity of -6.00, ROE of -45.3% and P/B of -18.7 are artifacts of negative shareholders' equity created by $200.1 million of buybacks in Q2 2026 alone and $350.3 million in Q4 2025. While not distress, it means leverage ratios are uninformative and the company has less flexibility if a downturn requires capital.
- Membership growth deceleration is the core bear case: Revenue growth of 7.14% is a sharp step down from the double-digit compounding the stock was priced for at 26.9x PS in mid-2025. The August gap from $56.59 to $51.21 suggests a guidance reset or demand shock, and with no recent analyst upgrades — only reiterations and a B of A downgrade to Neutral in May 2026 — the burden of proof remains on management.
PLNT Technical Analysis
Planet Fitness is in a pronounced, sustained downtrend that has only recently begun to stabilize. The stock is down 40.45% over the trailing year and 51.17% year-to-date, a catastrophic underperformance versus the S&P 500's +10.8% one-year return (relative strength of -51.25% over 12 months). At the current price of $53.58, the stock sits at roughly 21.6% of its 52-week range of $37.03 to $114.26 — near the bottom of the band but meaningfully off the low, a positioning that historically signals either a value opportunity forming or a falling knife that has not yet found a floor. The maximum drawdown of -63.83% confirms this has been a violent repricing rather than an orderly decline.
Short-term momentum has sharply decelerated from the longer-term trend, creating a notable divergence. The stock has rallied 26.91% over the past month — a massive relative strength of +28.72% versus SPY's -1.81% — yet remains down 4.17% over three months and 18.05% over six months. This pattern (strong 1-month bounce inside a weak 1-year trend) is classic mean-reversion off an oversold condition rather than a confirmed trend reversal; the October rally from a $40.50 low on September 28 to $53.58 has been steep and needs consolidation. Volume of roughly 1.58 million shares is moderate, and the 3.0 short ratio suggests short interest is meaningful but not extreme, leaving room for either a squeeze continuation or renewed selling pressure.
Key technical levels are well defined. Support sits at the 52-week low of $37.03, with a secondary shelf around $40.50 where the stock bottomed in late September; a breakdown below that zone would signal the downtrend is reasserting and open the door to new lows. Resistance is anchored at the 52-week high of $114.26 — far out of reach — but the more actionable near-term resistance is the $56-57 area where the stock failed in early August before gapping lower. A decisive breakout above $57 would suggest the October rally has legs; failure there would confirm a lower-high structure. With a beta of 1.045, the stock's volatility is roughly in line with the market, but the recent realized swings (a 30% single-day gap in May) mean position sizing should account for gap risk far exceeding what beta implies.
Beta
1.03
1.03x market volatility
Max Drawdown
-63.8%
Largest decline past year
52-Week Range
$37-$114
Price range past year
Annual Return
-40.1%
Cumulative gain past year
| Period | PLNT Return | S&P 500 |
|---|---|---|
| 1m | +29.8% | -2.0% |
| 3m | -2.8% | -2.0% |
| 6m | +25.0% | +3.1% |
| 1y | -40.1% | +10.4% |
| ytd | -49.8% | +10.6% |
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PLNT Fundamental Analysis
Revenue growth is positive but decelerating, and the multi-quarter trend is the crux of the bear case. Q2 2026 revenue of $365.2 million grew 7.14% year-over-year versus $340.9 million in Q2 2025, a respectable but unspectacular pace for a company that historically compounded at double digits. Sequentially, revenue has been choppy — $337.2 million in Q1 2026, $376.3 million in Q4 2025, $330.3 million in Q3 2025 — reflecting seasonality but also a lack of acceleration. Segment data shows Franchise revenue of $102.9 million, Equipment revenue of $85.6 million, and Advertising at $32.9 million, with the franchise and equipment lines (the highest-margin, most cyclical pieces) carrying the growth burden. The 7.1% growth rate implies the investment case now hinges on margin defense and capital returns rather than top-line reacceleration.
Profitability remains solid at the net line even as gross margins show volatility. Q2 2026 net income was $67.1 million on a 16.5% net margin, with operating income of $123.8 million (33.9% operating margin) and EBITDA of $169.7 million (46.5% EBITDA margin) — genuinely strong economics for a leisure company. However, the reported gross margin of 82.3% in Q2 2026 versus 38.9% in Q1 2026 and 53.2% in Q2 2025 reflects segment-mix and cost-of-revenue classification quirks rather than a true margin expansion, so investors should anchor on the operating margin (29.8% per the valuation data) and EBITDA margin, which are stable-to-improving. The key watch item is interest expense of $33.4 million in Q2 2026, up from $26.2 million a year earlier, which is eating into pre-tax income and reflects a heavier debt load.
Balance-sheet optics are the most confusing part of the story and require careful interpretation. The company carries $371.2 million in cash (Q2 2026) against a current ratio of 2.11, so near-term liquidity is fine, and free cash flow TTM is $261.7 million. But the reported debt-to-equity of -6.00 and ROE of -45.3% are artifacts of negative shareholders' equity — a byproduct of aggressive buybacks ($200.1 million repurchased in Q2 2026 alone, $350.3 million in Q4 2025) that have shrunk the equity base below zero. This is not distress; it is a deliberate capital-return strategy, but it does mean traditional leverage metrics are uninformative and investors should focus on absolute debt, interest coverage (roughly 3.7x), and FCF generation. The Q2 2026 free cash flow of just $4.0 million (versus $122.0 million in Q1) was depressed by working-capital swings and heavy capex of $41.9 million, so the TTM FCF figure is the more reliable gauge of cash-generating power.
Quarterly Revenue
$365223000.0B
2026-06
Revenue YoY Growth
+7.1%
YoY Comparison
Gross Margin
51.0%
Latest Quarter
Free Cash Flow
$261682000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is PLNT Overvalued?
Because Planet Fitness is profitable (Q2 2026 net income of $67.1 million; trailing EPS of $0.024 is distorted by a near-zero quarterly figure and should be treated cautiously), the PE ratio is the appropriate primary metric, supplemented by EV/EBITDA given the capital structure. The trailing PE of 41.4x looks expensive, but the forward PE of 14.64x against consensus FY EPS of $6.72 implies the market expects earnings to roughly triple — a gap that signals either enormous expected earnings recovery or that the trailing figure is distorted by one-time items. The EV/EBITDA of 20.4x and EV/Sales of 5.10x are the cleaner read: the market is paying a mid-teens multiple on forward earnings for a business with 46% EBITDA margins.
Against its own sector and history, the stock is now cheap on most measures. The PS ratio of 6.84x compares to historical PS readings that ranged from 11.0x (Q2 2026) to 26.9x (Q2 2025) and 29.4x (Q1 2025) — the current multiple is at the low end of a multi-year band, reflecting the de-rating. The PEG ratio of 1.36 is reasonable for a mid-single-digit grower, and the 51.9% gross margin and 29.8% operating margin are consistent with a premium franchise model. Peer comparison data is not available in the provided dataset, so a precise premium/discount to the leisure industry average cannot be quantified, but the directional read is that PLNT now trades at a discount to its own history rather than a premium.
Historical context reinforces the 'cheap versus itself' conclusion. The stock's PE has compressed from 48.3x in Q1 2025 and 44.1x in Q4 2024 to 41.4x trailing today, while the forward PE of 14.6x sits near the bottom of any recent band. The PS ratio of 6.84x is roughly a quarter of the 26.9x seen in mid-2025. This compression means the market is no longer pricing in optimistic growth — it is pricing in stagnation or deterioration. Whether that is a value opportunity or a value trap depends on whether the 7.1% revenue growth and 16.5% net margin prove durable; at 14.6x forward earnings, the bar for a positive surprise is now low.
PE
41.4x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 15x~72x
vs. Industry Avg
21.8x
Industry PE ~21.8x*
EV/EBITDA
20.4x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on the earnings bridge between operating strength and the bottom line. Q2 2026 operating income of $123.8 million was healthy, but interest expense of $33.4 million consumed roughly 27% of it, up from $26.2 million a year earlier, leaving pre-tax income of $96.1 million and interest coverage near 3.7x. Free cash flow is lumpy — just $4.0 million in Q2 2026 versus $122.0 million in Q1 — because of $41.9 million of capex and working-capital swings, so the $261.7 million TTM figure masks quarterly volatility. Negative shareholders' equity (debt-to-equity of -6.00, ROE of -45.3%) from $200.1 million of Q2 buybacks removes a buffer and makes traditional leverage analysis unreliable, while revenue concentration in corporate-owned stores and equipment sales to franchisees ties results to franchisee capex appetite.
Market and competitive risks are dominated by multiple compression and demand sensitivity. The stock's beta of 1.045 understates realized risk: a 30% single-day gap on May 7, 2026 (from $63.96 to $44.01) and another drop from $56.59 to $51.21 in early August show event risk far beyond market correlation. At 20.4x EV/EBITDA and 5.10x EV/Sales, PLNT is cheaper than its own history but still not a deep-value multiple, so any further deceleration in the 7.14% revenue growth rate could compress the forward PE below 14.6x. The HVLP fitness niche is increasingly contested by value gyms and budget home-fitness alternatives, and the B of A downgrade to Neutral in May 2026 plus Morgan Stanley's Equal Weight stance show that sell-side conviction is fracturing even as the consensus remains Buy.
Worst case, a renewed membership deceleration combined with sticky interest expense and a Q3 guidance cut would retest the 52-week low of $37.03, roughly -30.9% from the current $53.58, and a break below the $40.50 September shelf would confirm the downtrend and open the door to new lows. The analyst low target of $49.20 implies a milder -8.2% downside, but the -63.83% maximum drawdown shows how far the stock can fall when the growth narrative breaks. In a severe scenario where the forward multiple compresses to 10x on unchanged $6.72 EPS, the implied price is about $67 — but if EPS estimates are cut toward $5.50 alongside a 10x multiple, the stock would trade near $55, and a 9x multiple on $4.50 of stressed EPS would put it near $40, consistent with the 52-week low zone.
FAQ
Ranked by severity, the first risk is company-specific execution: revenue growth has decelerated to 7.14% YoY, and the August 2026 gap from $56.59 to $51.21 suggests a guidance reset, so a Q3 miss could repeat the May 7, 2026 single-day -31% move from $63.96 to $44.01. Second is financial: interest expense of $33.4 million in Q2 2026 rose 27.6% from $26.2 million and consumes roughly 27% of operating income at ~3.7x coverage, while negative shareholders' equity from $200.1 million of Q2 buybacks removes a buffer. Third is valuation and sentiment: the $49.20-$106.00 target range spans more than 2x, and with only reiterations plus B of A's May 2026 downgrade to Neutral, sell-side conviction is fracturing even as the 1.88 consensus mean reads Buy. Fourth is competitive and macro: the HVLP niche faces value gyms and budget home-fitness alternatives, and a beta of 1.045 understates realized event risk given the -63.83% max drawdown.
The 12-month distribution is 50% base, 25% bull, 25% bear. The base case targets $58-$70 (centered on the $65.58 analyst average, +22.4%) and assumes revenue growth holds in the 6-8% band, EBITDA margins stay near 46%, FY EPS lands within the tight $6.40-$7.00 cluster, and the multiple grinds modestly higher from 14.6x. The bull case targets $80-$106, bracketed by the $106.00 high target, and requires membership reacceleration above 8% revenue growth plus an upgrade from Morgan Stanley (Equal Weight) or B of A (Neutral). The bear case targets $37.03-$49.20, anchored on the 52-week low and the $49.20 low target, and would be triggered by a Q3 guidance cut or a close below the $40.50 September 28 shelf. The base case is most likely because analysts agree tightly on near-term fundamentals ($6.72 EPS, $1.98 billion revenue) and disagree only on the multiple — meaning the next earnings print, not sentiment, decides direction.
On the metrics that matter, PLNT looks undervalued relative to its own history but only fairly valued in absolute terms. The forward PE of 14.64x is the key number: it sits far below the trailing 41.4x and the 48.3x/44.1x readings from Q1 2025 and Q4 2024, and the PS ratio of 6.84x is roughly a quarter of the 26.9x seen in mid-2025. EV/EBITDA of 20.4x and EV/Sales of 5.10x are the cleaner read given negative shareholders' equity (debt-to-equity of -6.00 makes P/B of -18.7 meaningless), and neither is a deep-value multiple. The PEG of 1.36 is undemanding for a mid-single-digit grower with a 16.5% net margin and 29.8% operating margin. What the market is implying at 14.6x forward earnings is stagnation — no reacceleration from the current 7.14% revenue growth. If membership growth merely stabilizes, the multiple has room to re-rate toward the high-teens, which is the entire basis of the $65.58 consensus target.
The risk/reward is moderately favorable but not compelling enough for a high-conviction Buy. On the positive side, the stock at $53.58 trades at 14.64x forward EPS of $6.72 versus a trailing PE of 41.4x and historical readings of 48.3x in Q1 2025, while the $65.58 average analyst target implies +22.4% upside and the $106.00 high target implies +98%. The downside is quantifiable: the $49.20 analyst low target is -8.2% away, but the $37.03 52-week low is -30.9% away and the -63.83% max drawdown shows how far the stock can fall when the growth narrative breaks. The biggest single risk is a Q3 guidance cut, which already happened once in the form of the May 7, 2026 gap from $63.96 to $44.01. It is a good buy for investors with a 12-24 month horizon who size positions for gap risk and want a 46.5% EBITDA-margin franchise at a trough multiple; it is a poor buy for anyone needing near-term certainty or income, given the 0.017% dividend yield.
PLNT is better suited to a long-term hold than a short-term trade, but only with position sizing that accounts for gap risk. The business is a mature grower — 7.14% revenue growth, 46.5% EBITDA margin, $261.7 million TTM free cash flow — with no dividend to speak of (0.017% yield, payout ratio of 0.007), so total return depends on multiple re-rating rather than income or rapid compounding. Volatility is deceptive: beta of 1.045 looks market-like, yet the stock gapped -31% in a single session on May 7, 2026 and has a -63.83% max drawdown, so short-term traders face event risk that beta does not capture. Earnings visibility is moderate — the $6.40-$7.00 EPS cluster is tight, but the $49.20-$106.00 target range is not. A minimum holding period of 12-24 months is appropriate to let the Q3 2026 and subsequent prints prove whether membership reacceleration is real; shorter horizons amount to betting on the next earnings release.