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Planet Fitness Inc. (PLNT) Stock: Is It Time To Buy? Here is the INSIGHT

Planet Fitness (PLNT), one of the world’s largest gym chains, is gradually regaining its strength after an incredibly difficult 2020. Despite a lack of sales growth, the company sees visitors return to the newly opened halls, which is an excellent sign for the future.

With Planet Fitness’s franchise business model, the company persevered in the most challenging times during COVID-19. There are less than 5% Planet Fitness-branded gyms that are owned directly by the company. As a result, the network can be managed more efficiently, allowing the business to sustain itself in difficult times.

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Planet Fitness (PLNT) enjoys several competitive advantages, allowing the company to grow rapidly. For example, Planet Fitness has double the EBITDA margin of its closest competitor, Crunch Fitness, during regular periods. Adding to this, Planet Fitness is one of the most affordable gyms in the industry as well. Therefore, many subscribers kept their memberships even though the halls were closed. As the economy gradually recovers from the crisis, a lower price can also be an effective way to lure new customers, including those from other gyms.

For the first time since the start of the COVID-19 pandemic, Planet Fitness posted positive customer growth for three months in a row, although the company has not yet returned to its sales growth. At the same time, experience has shown that as soon as Planet Fitness gyms open, they immediately return to positive cash flow. Attendance is likely to be positively affected by the decision of the US Centers for Disease Control and Prevention to abolish the mandatory wearing of masks for vaccinated people.

In addition, the pandemic has accelerated Planet Fitness’s development of its digital segment. In particular, half of Planet Fitness’s members now download its free digital app, up from 40% in the previous quarter.

Planet Fitness (PLNT) shares were rising 0.69% to trade at $79.00 in the current market at the last check. Stock prices of PLNT closed at $86.46 in the previous session. There were 0.78 million shares traded, below the average daily volume of 1.06 million shares during the past 50 days. In the last 12 months, PLNT shares have increased by 24.94%, and they have gained 0.50% over the past week. The stock has gained 19.17% over the past six months, while it lost -10.92% over the past three months. In addition, the firm is currently valued at $6.84 billion, and there were 83.08 million outstanding shares.

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