Shares of Planet Fitness Inc. (PLNT) fell 1.3% toward a three-month low in premarket trading Thursday, following the fitness center operator's latest financial results. While the company beat fourth-quarter earnings expectations, it provided a downbeat growth outlook for the current year.
Financial Performance Highlights
- Net Income: Increased to $35.3 million, or 41 cents a share, up from $33.7 million, or 40 cents a share, in the year-ago period.
- Adjusted Earnings Per Share: Came in at 60 cents, surpassing the FactSet consensus of 58 cents.
- Total Revenue: Grew 1.4% to $285.1 million, exceeding the FactSet consensus of $282.7 million.
- Franchise Revenue: Rose by 13.9% to $98.2 million.
- Corporate-Owned Revenue: Increased by 15.9% to $116.4 million.
- Equipment Revenue: Dropped 25.5% to $70.4 million.
Growth Outlook and Forecast
For the year 2024, Planet Fitness expects adjusted EPS to increase in the 10% to 11% range and revenue to be up 6% to 7%. However, the FactSet consensus indicates higher growth rates, with EPS expected to grow by 12.1% and revenue by 7.8%.
Transition Year for Franchisees
The company's CEO, Craig Benson, noted that with the new growth model focused on reducing capital requirements for opening and maintaining franchise locations, 2024 will be a "transition year" for franchisees.
Stock Performance
Year to date, Planet Fitness stock has declined by 9.8%, in contrast to the broader market represented by the S&P 500, which has gained 4.4%.
Overall, while Planet Fitness exceeded earnings expectations, the market reaction indicates concerns regarding its growth outlook for the coming year.
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