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Planet Fitness Gets Green Signal for Reopening in New York
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Fitness centres across the world have been bearing the brunt of the coronavirus pandemic and Planet Fitness, Inc. (PLNT - Free Report) is no exception. The news of the possible reopening of New York state gyms on Aug 24 provided a boost to the company. Upon reopening, the gyms are likely to maintain strict safety protocols in compliance with guidelines from regulatory authorities.
Notably, Governor Andrew Cuomo’s guidelines include sign-in with contact information and health screening, limiting capacity (to 33%), appropriate cleaning and disinfecting equipment in between uses, installing special HVAC filters, and requiring all member and patrons to wear a mask inside the premises. Moreover, the gyms are likely to be frequently inspected by local health departments to ensure compliance with the safety protocols.
In this regard, management of Planet Fitness stated, “We look forward to working with our franchisees to safely reopen our locations in New York under Governor Cuomo’s guidelines, in order to provide New Yorkers with much needed access to high quality, affordable health and fitness.”
Reopening of Stores to Drive Growth
Following the closure of the company’s stores in March, the company implemented a reopening approach on May 1. Notably, it reopened two stores in Georgia and one in Utah, in accordance with local official guidelines. Keeping in mind the safety of its team and members, the company plans to make additional store re-openings in the coming periods as well. As of Jun 30, 2020, 1,490 stores were reopened, of which 1,451 were franchisee-owned stores and 39 corporate-owned.
We believe that despite the outbreak of the virus, the company will be able to retain its members due to its low-cost gym model. Although the nature of the business is traditional, the company’s strategy to attract customers with a $10-a-month membership fee and no-frills atmosphere helped it gain a significant share in the existing market and keep gaining traction. The low-cost model also helped Planet Fitness tap into the market that is upbeat about joining a cheaper second gym. Despite a lower-than-peer membership fee, higher demand and lower costs have helped the company generate above-average profits.
So far this year, shares of the company have declined 25.5% compared with the industry’s plunge of 45.1%.
Zacks Rank & Stocks to Consider
Planet Fitness currently carries a Zacks Rank #4 (Sell).
Activision Blizzard has a three-five year earnings per share growth rate of 17.3%.
Twin River and K12’s 2021 earnings are expected to surge 273.5% and 73.3%, respectively.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
Planet Fitness Gets Green Signal for Reopening in New York
Fitness centres across the world have been bearing the brunt of the coronavirus pandemic and Planet Fitness, Inc. (PLNT - Free Report) is no exception. The news of the possible reopening of New York state gyms on Aug 24 provided a boost to the company. Upon reopening, the gyms are likely to maintain strict safety protocols in compliance with guidelines from regulatory authorities.
Notably, Governor Andrew Cuomo’s guidelines include sign-in with contact information and health screening, limiting capacity (to 33%), appropriate cleaning and disinfecting equipment in between uses, installing special HVAC filters, and requiring all member and patrons to wear a mask inside the premises. Moreover, the gyms are likely to be frequently inspected by local health departments to ensure compliance with the safety protocols.
In this regard, management of Planet Fitness stated, “We look forward to working with our franchisees to safely reopen our locations in New York under Governor Cuomo’s guidelines, in order to provide New Yorkers with much needed access to high quality, affordable health and fitness.”
Reopening of Stores to Drive Growth
Following the closure of the company’s stores in March, the company implemented a reopening approach on May 1. Notably, it reopened two stores in Georgia and one in Utah, in accordance with local official guidelines. Keeping in mind the safety of its team and members, the company plans to make additional store re-openings in the coming periods as well. As of Jun 30, 2020, 1,490 stores were reopened, of which 1,451 were franchisee-owned stores and 39 corporate-owned.
We believe that despite the outbreak of the virus, the company will be able to retain its members due to its low-cost gym model. Although the nature of the business is traditional, the company’s strategy to attract customers with a $10-a-month membership fee and no-frills atmosphere helped it gain a significant share in the existing market and keep gaining traction. The low-cost model also helped Planet Fitness tap into the market that is upbeat about joining a cheaper second gym. Despite a lower-than-peer membership fee, higher demand and lower costs have helped the company generate above-average profits.
So far this year, shares of the company have declined 25.5% compared with the industry’s plunge of 45.1%.
Zacks Rank & Stocks to Consider
Planet Fitness currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the Zacks Consumer Discretionary sector are Twin River Worldwide Holdings, Inc. , Activision Blizzard, Inc. and K12 Inc. (LRN - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Activision Blizzard has a three-five year earnings per share growth rate of 17.3%.
Twin River and K12’s 2021 earnings are expected to surge 273.5% and 73.3%, respectively.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>