Peloton Interactive stock is rallying but Argus says it's not time to buy yet

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Argus maintained a Hold rating on Peloton Interactive Inc. (NASDAQ:PTON) on Thursday on its view that it is too early to bet on a recovery.

Analyst John Staszak and team think that the exercise services and equipment company will face headwinds over the next 12 months.

After reporting a larger-than-anticipated loss for FQ1, Staszak and team forecast further losses in FY23, reflecting supply-chain disruptions, seasonally weak demand and higher raw material and freight costs.

"We also expect the reopening of gyms and increased competition to weigh on results. Over the long term, we expect Peloton to benefit from increased interest in fitness products and operating leverage on higher sales."

However, for the near-term, Argus sees a Peloton FY23 loss of $2.00 per share vs. a prior view for a $1.80 per share loss and -$2.41 consensus. The firm also expects FY24 earnings estimate to come in $0.24 per share vs. a $0.30 per share prior view.

Shares of Peloton (PTON) jumped 13.55% on Thursday, but fell pennies short of hitting double-digits for the first time since September.

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