Yahoo Finance Live discusses a drop in Peloton stock following a report by Morgan Stanley analyzing the brands web traffic.
Video Transcript
DAVE BRIGGS: But my play is Peloton. Shares pedaling downhill fast today on the heels of new numbers from Morgan Stanley. Analyst Laurence Schenk telling clients, quote, "Without the help of significant promotions observed in the second quarter, Peloton web traffic decelerated to minus 27% in Q3." That's year over year. Schenk adding, although web traffic is still above pre-COVID levels, the two-year trends have continued to deteriorate, failing to find the stability needed for a return to growth. Big problem there.
The stock plummeting double digits today. Still, though, up more than 25% year to date after just getting devastated in 2022. Bottom line is, here, the margins are terrible on the fitness, equipment, on the bike, on the treadmill, et cetera. The margins all come on that app. And that's Barry McCarthy's focus, but not entirely clear there is room, there is a catalyst for true growth. And I can see her face. That's no.
SEANA SMITH: Yeah, no, I don't think there is. I think their partnership with Amazon, yes, that was a step in the right direction. Their latest earnings report that they just released, it showed that cash burn was at least improving, but you're right. In terms of that real catalyst for the turnaround story, that's lacking at that, up until this point still. We'll hear whether or not McCarthy has anything else to announce at the earnings report here in just--
DAVE BRIGGS: M&A.
SEANA SMITH: --a couple weeks from now.
DAVE BRIGGS: M&A. Somebody's got to buy them.
SEANA SMITH: Buy them.
DAVE BRIGGS: Right, right, not sure who.
SEANA SMITH: That's a big debate. All right.
