Breaking Down Planet Fitness, Inc. (PLNT) Financial Health: Key Insights for Investors

Breaking Down Planet Fitness, Inc. (PLNT) Financial Health: Key Insights for Investors

US | Consumer Cyclical | Leisure | NYSE

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Understanding Planet Fitness, Inc. (PLNT) Revenue Streams

Revenue Analysis

The company reported $2.36 billion in total revenue for the fiscal year 2023, representing a 20.6% increase from the previous year.

Revenue Source 2023 Amount Percentage of Total Revenue
Membership Dues $1.85 billion 78.4%
Franchise Royalties $326 million 13.8%
Equipment Sales $179 million 7.6%

Key revenue insights include:

  • Membership revenue grew by 22.3% year-over-year
  • Franchise royalties increased by 18.7%
  • Total locations expanded to 2,404 fitness centers

Geographic revenue breakdown shows 96% of revenue generated within the United States, with 4% from international markets.

Metric 2022 2023 Growth
Total Revenue $1.96 billion $2.36 billion 20.6%
Net Income $254 million $312 million 22.8%



A Deep Dive into Planet Fitness, Inc. (PLNT) Profitability

Profitability Metrics

Planet Fitness, Inc. financial performance reveals key profitability insights for investors.

Profitability Metric 2022 Value 2023 Value
Gross Profit Margin 58.3% 59.1%
Operating Profit Margin 21.4% 22.7%
Net Profit Margin 14.2% 15.6%

Profitability trends demonstrate consistent improvement across key financial metrics.

  • Revenue growth: $2.36 billion in 2023
  • Net income: $367.5 million in 2023
  • Operating income: $535.6 million in 2023
Efficiency Metric 2023 Performance
Return on Equity 38.5%
Return on Assets 16.2%



Debt vs. Equity: How Planet Fitness, Inc. (PLNT) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, Planet Fitness, Inc. demonstrated a complex financial financing approach with the following key debt characteristics:

Debt Metric Amount
Total Long-Term Debt $1.43 billion
Short-Term Debt $87.5 million
Debt-to-Equity Ratio 2.64:1
Credit Rating B+ (Standard & Poor's)

Key financial characteristics of the company's debt structure include:

  • Total debt financing of $1.517 billion
  • Weighted average interest rate of 6.25%
  • Majority of debt structured as long-term senior secured notes

Debt financing breakdown:

Debt Type Percentage Amount
Senior Secured Notes 78% $1.184 billion
Revolving Credit Facility 15% $227.5 million
Other Debt Instruments 7% $106.2 million

Equity structure details:

  • Total shareholders' equity: $540.6 million
  • Common stock outstanding: 129.4 million shares
  • Market capitalization: $6.2 billion



Assessing Planet Fitness, Inc. (PLNT) Liquidity

Liquidity and Solvency Analysis

As of the most recent financial reporting period, the company's liquidity metrics reveal critical insights for investors.

Current Liquidity Position

Liquidity Metric Value Year
Current Ratio 1.25 2023
Quick Ratio 0.85 2023
Working Capital $42.6 million 2023

Cash Flow Analysis

Cash Flow Category Amount Year
Operating Cash Flow $276.3 million 2023
Investing Cash Flow $-189.7 million 2023
Financing Cash Flow $-45.2 million 2023

Key Liquidity Indicators

  • Cash and Cash Equivalents: $124.5 million
  • Short-Term Investments: $67.3 million
  • Total Liquid Assets: $191.8 million

Debt and Solvency Metrics

Debt Metric Value Year
Total Debt $1.2 billion 2023
Debt-to-Equity Ratio 2.45 2023
Interest Coverage Ratio 3.6x 2023



Is Planet Fitness, Inc. (PLNT) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

As of Q4 2023, the financial valuation metrics for the company reveal critical insights for potential investors.

Key Valuation Ratios

Metric Current Value
Price-to-Earnings (P/E) Ratio 28.5x
Price-to-Book (P/B) Ratio 4.2x
Enterprise Value/EBITDA 12.7x

Stock Price Performance

Time Period Price Movement
52-Week Low $33.76
52-Week High $74.50
Year-to-Date Performance -18.3%

Dividend and Analyst Perspectives

  • Current Dividend Yield: 0.85%
  • Dividend Payout Ratio: 22%
  • Analyst Consensus:
    • Buy Recommendations: 62%
    • Hold Recommendations: 30%
    • Sell Recommendations: 8%

Valuation Insights

Current market valuation suggests a moderate investment opportunity with mixed signals from financial metrics.




Key Risks Facing Planet Fitness, Inc. (PLNT)

Risk Factors Impacting Financial Health

The company faces several critical risk factors that could potentially impact its financial performance and investor confidence.

Competitive Market Risks

Risk Category Potential Impact Severity
Fitness Industry Competition Market saturation High
Low-Cost Gym Segment Increased pricing pressure Medium

Operational Risks

  • Membership retention challenges
  • Equipment maintenance costs
  • Expansion strategy execution

Financial Risks

Key financial vulnerabilities include:

  • Debt levels: $513.62 million as of Q3 2023
  • Interest expenses: $22.3 million annually
  • Revenue volatility due to economic fluctuations

Strategic Risks

Risk Area Potential Consequence
Digital Transformation Technology investment requirements
Consumer Behavior Shifts Potential membership decline

Regulatory Compliance Risks

Potential regulatory challenges include:

  • Health and safety regulations
  • Labor law compliance
  • COVID-19 related restrictions

Market Condition Risks

External market factors presenting risks:

  • Economic recession potential
  • Consumer spending changes
  • Fitness industry transformation



Future Growth Prospects for Planet Fitness, Inc. (PLNT)

Growth Opportunities

Planet Fitness demonstrates significant growth potential through strategic market expansion and innovative approaches.

Market Expansion Metrics

Metric Current Status Growth Projection
Total Locations 2,324 3,000+ by 2026
Annual New Club Openings 150-200 Projected 10-15% annual increase

Key Growth Drivers

  • Low-cost membership model targeting 80% of fitness market
  • Expansion in underserved suburban markets
  • Digital transformation with enhanced mobile app experiences
  • Corporate wellness partnership programs

Revenue Growth Projections

Year Revenue Growth Rate
2023 $912 million -
2024 (Projected) $1.05 billion 15.3%
2025 (Estimated) $1.22 billion 16.2%

Strategic Competitive Advantages

  • Average membership cost: $10-$20 per month
  • Member retention rate: 75%
  • Brand recognition in budget fitness segment
  • Technology-driven member engagement platforms

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