Shares of Peloton Interactive (NASDAQ:PTON) have had a dismal 2021 after returning a staggering 395% in 2020. In fact, the stay-at-home exercise equipment maker has lost 73% of its value since the start of 2021. The recent news propelling PTON stock into the spotlight isn’t helping, either. Shares of PTON stock are currently trading below $40 for the first time since May 2020.
What Happened With PTON Stock?
And Just Like That is an HBO reboot that details the life of a sex columnist and her three friends as they experience the dating scene in Manhattan. The original Sex and the City show boasts a cult-like following and is rated 7.2/10 on IMDb. Yesterday, the first episode of the reboot premiered. At the end of the episode, a character drops dead from a heart attack after completing a 45-minute Peloton ride. Obviously, this is a horrible image for Peloton to represent.
Peloton released a response, explaining that while it knew the Peloton Bike would be featured in the show, it did not know how the storyline would progress.
Dr. Suzanne Steinbaum, a preventative cardiologist on Peloton’s health and advisory council, added that the character’s “extravagant lifestyle — including cocktails, cigars, and big steaks,” as well as his family history, ultimately were to blame. Furthermore, she explained that riding the Peloton Bike may have delayed his heart attack instead of causing it.
Analysts at BMO Capital Markets commented on the situation, reasoning:
“Although unlikely to impact sales, it does question whether PTON is losing degrees of control over its storytelling, perhaps its greatest achievement to date.”
The Bottom Line on Peloton
Making matters worse, PTON stock was downgraded today by Credit Suisse to “neutral” from “outperform.” Analyst Kaumil Gajrawala slashed his price target from $112 to $50, representing a decrease of 55%.
It seems Peloton has a rocky road moving forward. Credit Suisse mentioned that Peloton is spending more on advertising and decreasing prices as the population starts returning to in-person gyms. This could potentially “change the economic model.” Peloton also reduced its fiscal year 2022 guidance for new subscribers and sales during its last earnings release.
Investors will want to mark their calendars for when Peloton shares its next quarterly update.
On the date of publication, Eddie Pan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.