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Planet Fitness, Inc. (PLNT - Free Report) reported impressive third-quarter 2022 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The metrics increased on a year-over-year basis.
Following the announcement, shares of the company increased 8.6% during trading hours on Nov 8. Positive investor sentiments were witnessed as the company forwarded better-than-expected guidance for 2022. Solid membership trends and lower cancellations (compared with pre-COVID levels) added to the positives.
Earnings & Revenue Discussion
During the third quarter, the company reported adjusted earnings per share (EPS) of 42 cents, beating the Zacks Consensus Estimate of 39 cents. In the prior-year quarter, the company reported an adjusted EPS of 25 cents.
Planet Fitness, Inc. Price, Consensus and EPS Surprise
Quarterly revenues of $244.4 million beat the consensus mark of $237 million. However, the top line surged 58.4% from the year-ago quarter’s levels, driven by solid performances in the Franchise, Corporate-owned Stores and Equipment segments. During the quarter under review, system-wide same-store sales increased 8.2% year over year compared with growth of 13.6% reported in the previous quarter.
Total adjusted EBITDA at the end of the third quarter was $93.9 million compared with $61.7 million reported in the year-ago quarter.
Segmental Performance
During third-quarter 2022, Franchise segment revenues were $80.7 million, up 7.1% year over year. The upside was driven by a $2.8 million rise in franchise royalty revenues, a $0.7-million gain in National Advertising Fund (NAF) revenues and a $1.7-million surge in equipment placement revenues.
EBITDA in the Franchise segment was $53.5 million compared with $52 million reported in the prior-year quarter.
The Corporate-owned Stores segment’s third-quarter revenues amounted to $101.3 million compared with $43.9 million reported in the prior-year quarter. The increase can primarily be attributed to a rise in same-store sales and new store openings. The acquisition of 114 stores through the Sunshine Fitness buyout contributed $50.4 million to the segment’s revenues. The segment’s EBITDA totaled $40.4 million compared with $14.1 million reported in the prior-year quarter.
In the Equipment segment, revenues totaled $62.3 million compared with $35 million reported in the prior-year quarter. The uptick was primarily driven by higher equipment sales to existing franchisee-owned stores. EBITDA in the Equipment segment was $15.8 million compared with $7.9 million reported in the prior-year quarter.
Other Financial Details
As of Sep 30, 2022, cash and cash equivalents totaled $404.5 million compared with $383.5 million as of Jun 30, 2022. Long-term debt (net of current maturities) amounted to $1,982.2 million at the end of third-quarter 2022 compared with $1,985.7 million at the prior-quarter end.
2022 Outlook
For 2022, the company continues to expect revenues to increase in the high-50 percent range year over year, up from the previous projection of a mid-50 percent range. Adjusted EBITDA for 2022 is estimated to rise approximately 60% year over year compared with the previous expectation of a high-50 percent range. Adjusted net income is anticipated at the low-100% range (over the 2021 levels) compared with the previous expectation of a low-90% range. The company anticipates adjusted EPS to increase in the mid-90% range year over year compared with the previous projection of a mid-80% range. The metrics are based on the assumption of potential impact from the Sunshine Fitness acquisition and that there is no significant impact of the COVID-19 pandemic.
Marriott currently carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.1%, on average. The stock has declined 8.7% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates a surge of 47% and 104.7%, respectively, from the year-ago period’s reported levels.
Crocs currently has a Zacks Rank #2. CROX has a long-term earnings growth rate of 15%. Shares of Crocs have plunged 53.6% in the past year.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 51.5% and 23.7%, respectively, from the year-ago period’s levels.
Boyd Gaming carries a Zacks Rank #2. BYD has a long-term earnings growth rate of 12.8%. The stock has declined 8.8% in the past year.
The Zacks Consensus Estimate for BYD’s 2022 sales and EPS indicates growth of 4.4% and 11.7%, respectively, from the year-ago period’s reported levels.
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Planet Fitness (PLNT) Q3 Earnings Surpass Estimates, Rise Y/Y
Planet Fitness, Inc. (PLNT - Free Report) reported impressive third-quarter 2022 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The metrics increased on a year-over-year basis.
Following the announcement, shares of the company increased 8.6% during trading hours on Nov 8. Positive investor sentiments were witnessed as the company forwarded better-than-expected guidance for 2022. Solid membership trends and lower cancellations (compared with pre-COVID levels) added to the positives.
Earnings & Revenue Discussion
During the third quarter, the company reported adjusted earnings per share (EPS) of 42 cents, beating the Zacks Consensus Estimate of 39 cents. In the prior-year quarter, the company reported an adjusted EPS of 25 cents.
Planet Fitness, Inc. Price, Consensus and EPS Surprise
Planet Fitness, Inc. price-consensus-eps-surprise-chart | Planet Fitness, Inc. Quote
Quarterly revenues of $244.4 million beat the consensus mark of $237 million. However, the top line surged 58.4% from the year-ago quarter’s levels, driven by solid performances in the Franchise, Corporate-owned Stores and Equipment segments. During the quarter under review, system-wide same-store sales increased 8.2% year over year compared with growth of 13.6% reported in the previous quarter.
Total adjusted EBITDA at the end of the third quarter was $93.9 million compared with $61.7 million reported in the year-ago quarter.
Segmental Performance
During third-quarter 2022, Franchise segment revenues were $80.7 million, up 7.1% year over year. The upside was driven by a $2.8 million rise in franchise royalty revenues, a $0.7-million gain in National Advertising Fund (NAF) revenues and a $1.7-million surge in equipment placement revenues.
EBITDA in the Franchise segment was $53.5 million compared with $52 million reported in the prior-year quarter.
The Corporate-owned Stores segment’s third-quarter revenues amounted to $101.3 million compared with $43.9 million reported in the prior-year quarter. The increase can primarily be attributed to a rise in same-store sales and new store openings. The acquisition of 114 stores through the Sunshine Fitness buyout contributed $50.4 million to the segment’s revenues. The segment’s EBITDA totaled $40.4 million compared with $14.1 million reported in the prior-year quarter.
In the Equipment segment, revenues totaled $62.3 million compared with $35 million reported in the prior-year quarter. The uptick was primarily driven by higher equipment sales to existing franchisee-owned stores. EBITDA in the Equipment segment was $15.8 million compared with $7.9 million reported in the prior-year quarter.
Other Financial Details
As of Sep 30, 2022, cash and cash equivalents totaled $404.5 million compared with $383.5 million as of Jun 30, 2022. Long-term debt (net of current maturities) amounted to $1,982.2 million at the end of third-quarter 2022 compared with $1,985.7 million at the prior-quarter end.
2022 Outlook
For 2022, the company continues to expect revenues to increase in the high-50 percent range year over year, up from the previous projection of a mid-50 percent range. Adjusted EBITDA for 2022 is estimated to rise approximately 60% year over year compared with the previous expectation of a high-50 percent range. Adjusted net income is anticipated at the low-100% range (over the 2021 levels) compared with the previous expectation of a low-90% range. The company anticipates adjusted EPS to increase in the mid-90% range year over year compared with the previous projection of a mid-80% range. The metrics are based on the assumption of potential impact from the Sunshine Fitness acquisition and that there is no significant impact of the COVID-19 pandemic.
Zacks Rank & Stocks to Consider
Planet Fitness currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Consumer Discretionary sector are Marriott International, Inc. (MAR - Free Report) , Crocs, Inc. (CROX - Free Report) and Boyd Gaming Corporation (BYD - Free Report) .
Marriott currently carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.1%, on average. The stock has declined 8.7% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates a surge of 47% and 104.7%, respectively, from the year-ago period’s reported levels.
Crocs currently has a Zacks Rank #2. CROX has a long-term earnings growth rate of 15%. Shares of Crocs have plunged 53.6% in the past year.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 51.5% and 23.7%, respectively, from the year-ago period’s levels.
Boyd Gaming carries a Zacks Rank #2. BYD has a long-term earnings growth rate of 12.8%. The stock has declined 8.8% in the past year.
The Zacks Consensus Estimate for BYD’s 2022 sales and EPS indicates growth of 4.4% and 11.7%, respectively, from the year-ago period’s reported levels.