UBS is more optimistic on Peloton heading into its fiscal fourth-quarter earnings. The bank upgraded shares of the exercise equipment company to a buy rating from neutral. Analyst Arpine Kocharyan's new price target of $11, upped from $7.50, offers upside of 78% from Peloton's Tuesday close. Shares popped more than 7% after the upgrade. PTON 5D mountain PTON 5-day chart Kocharyan noted that an improvement in online traffic could hint at a stabilizing subscriber base. "While we see subscription price increases anchoring near-term top line growth, we might also see underlying net subscriber decline stabilizing into FY'26, outside of price increase driven churn. While that inflection in connected fitness subs is not entirely clear to us yet, we are seeing better data trends for Peloton in terms of traffic and active users," she wrote. "Interactive visits for May improved to flattish YOY from down -11% in May, while active users have turned positive in May/June after declines since beginning of the year." The analyst also expects upside to Peloton's fiscal 2026 earnings before interest, taxes, depreciation and amortization, or EBITDA, expectations from further top-line growth and cost-cutting measures. These measures include general expenses optimization, tech debt reduction and the shrinking of Peloton's showroom footprint. The company will next report earnings on Aug. 7. "We estimate +11-12% pricing increase in connected fitness subscription could drive roughly $90M-$100M of annualized revenue uplift, net of impact from higher churn," Kocharyan said. "We also see upside to PTON's $200M+ run rate cost saves target, with PTON also annualizing run rate cost saves in FY'26." Analysts on Wall Street are split on Peloton. LSEG data shows that of the 22 who cover the stock, 12 have a hold rating, while another nine rate it a buy or strong buy. One analyst has an underperform rating on shares.
