Xponential's (XPOF) Club Pilates Brand Debuts in France
Xponential Fitness, Inc. XPOF recently debuted in France with a Master Franchise Agreement for its Club Pilates brand. This marks its presence in 19 countries outside of North America.
The agreement with TCMP Fitness, LP and its partners Susan and Chris Fichaud will enable the master franchisee to license a minimum of 75 Club Pilates studios in the country over the next 10 years. This debut will assist the company to continue discovering the vast European pilates & yoga studio market that is anticipated to reach $71.2 million by 2030, per Allied Market Research.
Club Pilates’ Footprint Expansion
The aforementioned master franchise partners have been bringing the Club Pilates brand to local markets and assembling highly-qualified teams for the past eight years. They recently entered into master franchise agreements to develop Club Pilates in Ireland and Switzerland and are the third domestic franchisee of Xponential to expand its operations globally.
The currently operating studios of the Club Pilates brand across Spain and Germany act as a developing platform for the newly entered contract in France. Also, the brand’s development agreements in Austria, Ireland, the Netherlands, Portugal, Switzerland and the UK add to its expansion initiatives.
Xponential is optimistic about the France debut as the brand’s outlook aligns with the health and wellness conscious French community.
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Shares of XPOF grew 2.4% during the trading session on Jul 11. The stock has gained 47.5% in the past year, outperforming the Zacks Leisure and Recreation Services industry’s 31.2% growth.
Xponential’s Franchisee Synergies
Xponential is one of the largest global franchisors of boutique fitness brands and is witnessing robust demand for its brands outside of North America. The company’s growth durability is primarily backed by new studios opened by its franchisees along with additional business in the existing locations.
As of Mar 31, 2023, Xponential operated about 2,756 studios globally with a total of 5,638 licenses sold across its 10 leading fitness brands. In the first quarter, franchise revenues of the company grew 29.3% year over year to $33 million. The company has more than 1,000 studios obligated to be opened under master franchise agreements, internationally.
However, increased operating costs and expenses are affecting the bottom line of the company. Nevertheless, given the strong pipeline, the company expects to gain traction and deliver growth momentum in the upcoming period.
Zacks Rank & Key Picks
Xponential currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks from the Consumer Discretionary sector are Corsair Gaming, Inc. CRSR, Caesars Entertainment, Inc. CZR and Marriott International, Inc. MAR.
Corsair Gaming presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
CRSR has a negative trailing four-quarter earnings surprise of 125%, on average. The stock has gained 29.2% in the year-to-date period. The Zacks Consensus Estimate for CRSR’s 2023 sales and earnings per share (EPS) indicates a rise of 7% and 233.3%, respectively, from the year-ago period’s levels.
Caesars Entertainment presently carries a Zacks Rank #2 (Buy). CZR has a trailing four-quarter earnings surprise of 28.2%, on average. The stock has gained 25.6% in the year-to-date period.
The Zacks Consensus Estimate for CZR’s 2023 sales and earnings per share (EPS) indicates a rise of 7.1% and 108.9%, respectively, from the year-ago period’s levels.
Marriott currently carries a Zacks Rank of 2. MAR has a trailing four-quarter earnings surprise of 8%, on average. Shares of the company have increased 28.4% in the year-to-date period.
The Zacks Consensus Estimate for MAR’s 2023 sales and EPS indicates a rise of 13.1% and 25.7%, respectively, from the year-ago period’s levels.
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