The fitness industry has always been an unchanging beast. As a result, it can be difficult for a business to achieve long-term success in space.

Congratulations PelotonWith the advent of popular fitness equipment, the world is slowly reopening and as the epidemic progresses, demand is waning. At one time the hottest product in the industry was extremely cold, and Peloton accumulation decreased Only 40% last month.

Planet Fitness (NYSE ፡ PL PLNT)However, he has developed a successful strategy in this challenging market. Of Gym stock It grows in a very interesting way.

Image source: Getty Images

Jumping Your Exercise

In the third quarter, Planet Fitness returned to post the same store sales growth of 7.2%. The company’s 2,193 locations have largely reopened, and the business has seen the largest increase in membership in the third quarter of its history.

Interestingly, the key to the company’s success is getting new customers. no I do not Use the gym. In this way, Planet Fitness can still generate significant recurring revenue without affecting capacity and equipment. And the cheapest membership fee is less than $ 10 a month, which reduces the chances of an ordinary gym genius canceling, believing that he or she will do better in the future.

“We see 30% to 40% of our members using the club in 30 days,” said Chris Rondew, CEO. Recent incoming calls. Thus, of the more than 15 million fitness members on the planet, approximately 5.3 million currently visit at least once a month. Rondeau Historically 50% of clients use fitness clubs within 30 days. This means that there is a large user base that pays but is rarely seen.

This is in stark contrast to the health insurance model, in which healthy individuals subsidize unhealthy people. It is often a positive sign that customers are actively using the company’s products or services, because high engagement is valuable. But with exercise, people often lose interest or quickly lose interest in their diet and exercise goals. This works for the benefit of the company.

Raising direction

The administration is pleased with the quarterly and the company’s ongoing recovery from the outbreak and has revised its guidelines. For the full year 2021, Planet Fitness is projected to sell from $ 530 million to $ 540 million, from $ 570 million to $ 580 million. This 2021 will be the company’s biggest revenue year in addition to 2019.

And Planet Fitness now opens 110 to 120 net new stores a year. “We continue to say we believe we will return to the 200-plus range,” said CFO Dorvin Lively. According to the IHRSA, more than one in five fitness centers is permanently closed due to the epidemic. None of the planet’s fitness resources have been achieved during this time, which is a clear indication that the Franks are financially strong and willing to continue their commitment to the product.

If we use the last quarter as a guide, Planet Fitness He seems to be continuing his remarkable growth before 2020 and before disrupting the world. Investors need to look at the stock to maximize their portfolio.

This article represents the author’s opinion which does not agree with the “Official” decision of the Motley Ful Premium Consulting Service. We are Motoli! Asking for investment ideas – even our own – can help us all think critically about investing and make decisions that will make us smarter.