I'm putting my eye on PTON. On one hand, they are losing a lot of money, usage of their devices is in decline, and their management is very questionable. On the other hand, they have a new CEO (no idea if he's good yet) but more importantly, have a growing subscription business it seems. More revenue is coming from selling bikes and the like, but that's a losing money or break even business so we can ignore it. But they made $300K in subscriptions last quarter, and it's a high margin business. The current valuation seems attractive given a $1.2B annual revenue from subscriptions. The main risk I see is that the decline in usage means decline in subscription growth and cancelations. The only way for PTON to succeed is if they can continue growing their subscription business.
Thoughts?
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