Analysis of Companies with Strong Cash Flow Performance
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 17 hours ago
0mins
Source: Yahoo Finance
- Planet Fitness Performance Decline: Despite a free cash flow margin of 19.2%, Planet Fitness has experienced weak same-store sales over the past two years, indicating limited expansion opportunities in core markets, with capital intensity expected to rise and free cash flow margin contracting by 5.5 percentage points, negatively impacting valuation.
- Wabtec Growth Potential: With a free cash flow margin of 13.1%, Wabtec has achieved a 9.1% annual sales growth over the past five years, benefiting from improved operating profits and efficiency, while share buybacks have propelled annual earnings per share growth to 19.9%, showcasing strong market performance in the railway sector.
- Paymentus Market Share Increase: Founded in 2004, Paymentus has a free cash flow margin of 8.2%, with annual revenue growth of 40.2% over the past two years, significantly enhancing profitability, as evidenced by a 51% annual growth in earnings per share outpacing revenue growth, indicating increased market share in the bill payment sector.
- Cautious Investment Advice: While Wabtec and Paymentus demonstrate strong growth potential, the performance decline of Planet Fitness and the anticipated rise in capital intensity raise concerns about its investment value, prompting investors to exercise caution in their evaluations.
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Analyst Views on PLNT
Wall Street analysts forecast PLNT stock price to rise
13 Analyst Rating
13 Buy
0 Hold
0 Sell
Strong Buy
Current: 50.480
Low
120.00
Averages
133.25
High
185.00
Current: 50.480
Low
120.00
Averages
133.25
High
185.00
About PLNT
Planet Fitness, Inc. is a franchisor and operator of fitness centers in the world. The Company operates in three segments: Franchise, Corporate-owned club, and Equipment. The Franchise segment includes operations related to the Company’s franchising business in the United States, Puerto Rico, Canada, Panama, Mexico and Australia. The Corporate-owned clubs segment includes operations with respect to all Corporate-owned clubs throughout the United States, Canada, and Spain. The Equipment segment includes the sale of equipment to franchisee-owned clubs. The Company's subsidiaries operate three lines of business, which include licensing and selling franchises under the Planet Fitness trade name, owning, and operating fitness centers, and selling fitness-related equipment to franchisee-owned stores. It operates 2,735 clubs in all 50 states: the District of Columbia, Puerto Rico, Canada, Panama, Mexico, Australia and Spain.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Planet Fitness Under Investigation for Securities Fraud Following 31% Stock Drop
- Stock Price Plunge: On May 7, 2026, Planet Fitness's stock plummeted 31% from $63.96 to $44.01 per share, primarily due to disappointing Q1 membership growth results that undermined investor confidence.
- Marketing Strategy Failure: The company acknowledged that its marketing approach shifted too far towards 'fitness-minded' customers, alienating its core market and leading to a downward revision of its 2026 revenue growth forecast from 9% to 7%.
- Legal Investigation Initiated: Bleichmar Fonti & Auld LLP has launched an investigation into potential securities fraud by Planet Fitness, focusing on whether the company made false and misleading statements to investors that affected their decisions.
- Investor Rights Protection: Affected investors are encouraged to contact BFA Law to explore their legal options, with all representation on a contingency fee basis, meaning investors will not incur litigation costs.
See More
Analysis of Companies with Strong Cash Flow Performance
- Planet Fitness Performance Decline: Despite a free cash flow margin of 19.2%, Planet Fitness has experienced weak same-store sales over the past two years, indicating limited expansion opportunities in core markets, with capital intensity expected to rise and free cash flow margin contracting by 5.5 percentage points, negatively impacting valuation.
- Wabtec Growth Potential: With a free cash flow margin of 13.1%, Wabtec has achieved a 9.1% annual sales growth over the past five years, benefiting from improved operating profits and efficiency, while share buybacks have propelled annual earnings per share growth to 19.9%, showcasing strong market performance in the railway sector.
- Paymentus Market Share Increase: Founded in 2004, Paymentus has a free cash flow margin of 8.2%, with annual revenue growth of 40.2% over the past two years, significantly enhancing profitability, as evidenced by a 51% annual growth in earnings per share outpacing revenue growth, indicating increased market share in the bill payment sector.
- Cautious Investment Advice: While Wabtec and Paymentus demonstrate strong growth potential, the performance decline of Planet Fitness and the anticipated rise in capital intensity raise concerns about its investment value, prompting investors to exercise caution in their evaluations.
See More
Dorsal Capital Reduces Stake in Planet Fitness
- Stake Reduction Details: Dorsal Capital Management disclosed a reduction in its position in Planet Fitness during Q1 2026, selling 225,000 shares valued at approximately $19.78 million, indicating a potential decrease in confidence in the stock.
- Holding Proportion Change: Following the sale, Dorsal Capital's stake in Planet Fitness decreased to 7.3%, suggesting that despite the reduction, it remains one of their largest investments, reflecting ongoing interest in the company.
- Financial Performance Insights: Despite a 50% drop in stock price, Planet Fitness reported a 22% year-over-year revenue increase to $337.2 million in Q1, with adjusted EBITDA rising nearly 20%, showcasing the company's growth potential amidst market challenges.
- Market Challenges and Outlook: Management acknowledged a slower-than-expected start to 2026 for member growth, prompting a pause on planned price increases, yet the CEO emphasized a positive long-term outlook, anticipating benefits from rising health and wellness trends.
See More
Dorsal Capital Reduces Stake in Planet Fitness
- Stake Reduction: Dorsal Capital sold 225,000 shares of Planet Fitness in Q1, with an estimated transaction value of $19.78 million, indicating a potential decline in market confidence towards the company.
- Value Decline: The quarter-end value of Dorsal Capital's position in Planet Fitness decreased by $110.48 million, reflecting the negative impact of trading activities and price fluctuations on the investment portfolio.
- Performance Growth: Despite facing challenges, Planet Fitness reported a 22% year-over-year revenue increase to $337.2 million in Q1, while adjusted EBITDA rose nearly 20%, demonstrating the company's ongoing growth potential.
- Market Outlook and Challenges: CEO Colleen Keating noted that net member growth has started slower than expected in 2026; however, Planet Fitness's long-term strategy remains solid, positioning the company to benefit from the growing health and wellness trend.
See More
Planet Fitness Issues Weaker-Than-Expected Earnings Outlook
- Earnings Outlook Downgrade: Planet Fitness's FY 2026 earnings outlook was revised downward, projecting adjusted EPS growth of only 9%-10%, contrary to CFO Jay Stasz's earlier guidance, resulting in a significant drop in investor confidence and stock price.
- Revenue Growth Expectations: While the company had previously anticipated approximately 9% total revenue growth for 2025, the extended equipment replacement cycle, sale of eight corporate-owned clubs in California, and weather disruptions affecting around 2,000 clubs have severely impacted the 2026 earnings forecast, undermining market performance.
- Share Buyback Plan: Planet Fitness plans to repurchase approximately $150 million worth of shares in 2026, aiming to bolster investor confidence and stabilize stock prices; however, this initiative is overshadowed by the negative market reaction to the downgraded outlook.
- Legal Investigation Initiated: Levi & Korsinsky LLP is investigating whether Planet Fitness failed to adequately disclose material information when issuing its initial earnings guidance, potentially leading to investor losses and exacerbating market unease.
See More
Planet Fitness Issues Weaker Earnings Outlook, Investors Urged to Act
- Earnings Outlook Downgrade: Planet Fitness's FY 2026 earnings outlook was revised downward, projecting only 9%-10% adjusted EPS growth, which significantly undermined investor confidence and led to a sharp drop in stock price.
- Revenue Growth Expectations: Although CFO Jay Stasz previously indicated a projected 9% total revenue growth for 2026 during the Q4 2025 earnings call, actual performance may fall well short due to an extended equipment replacement cycle and other adverse factors.
- Shareholder Loss Investigation: Levi & Korsinsky is investigating whether Planet Fitness failed to disclose material information to investors, resulting in significant losses for shareholders after the stock price decline, potentially facing securities fraud allegations.
- Future Plans Hampered: The company plans to repurchase approximately $150 million in shares in 2026, but the sale of eight corporate-owned clubs in California and weather-related disruptions may severely impact future equipment placements and financial health.
See More
Planet Fitness Under Investigation for Securities Fraud Following 31% Stock Drop
- Stock Price Plunge: On May 7, 2026, Planet Fitness's stock plummeted 31% from $63.96 to $44.01 per share, primarily due to disappointing Q1 membership growth results that undermined investor confidence.
- Marketing Strategy Failure: The company acknowledged that its marketing approach shifted too far towards 'fitness-minded' customers, alienating its core market and leading to a downward revision of its 2026 revenue growth forecast from 9% to 7%.
- Legal Investigation Initiated: Bleichmar Fonti & Auld LLP has launched an investigation into potential securities fraud by Planet Fitness, focusing on whether the company made false and misleading statements to investors that affected their decisions.
- Investor Rights Protection: Affected investors are encouraged to contact BFA Law to explore their legal options, with all representation on a contingency fee basis, meaning investors will not incur litigation costs.
See More
Analysis of Companies with Strong Cash Flow Performance
- Planet Fitness Performance Decline: Despite a free cash flow margin of 19.2%, Planet Fitness has experienced weak same-store sales over the past two years, indicating limited expansion opportunities in core markets, with capital intensity expected to rise and free cash flow margin contracting by 5.5 percentage points, negatively impacting valuation.
- Wabtec Growth Potential: With a free cash flow margin of 13.1%, Wabtec has achieved a 9.1% annual sales growth over the past five years, benefiting from improved operating profits and efficiency, while share buybacks have propelled annual earnings per share growth to 19.9%, showcasing strong market performance in the railway sector.
- Paymentus Market Share Increase: Founded in 2004, Paymentus has a free cash flow margin of 8.2%, with annual revenue growth of 40.2% over the past two years, significantly enhancing profitability, as evidenced by a 51% annual growth in earnings per share outpacing revenue growth, indicating increased market share in the bill payment sector.
- Cautious Investment Advice: While Wabtec and Paymentus demonstrate strong growth potential, the performance decline of Planet Fitness and the anticipated rise in capital intensity raise concerns about its investment value, prompting investors to exercise caution in their evaluations.
See More
Dorsal Capital Reduces Stake in Planet Fitness
- Stake Reduction Details: Dorsal Capital Management disclosed a reduction in its position in Planet Fitness during Q1 2026, selling 225,000 shares valued at approximately $19.78 million, indicating a potential decrease in confidence in the stock.
- Holding Proportion Change: Following the sale, Dorsal Capital's stake in Planet Fitness decreased to 7.3%, suggesting that despite the reduction, it remains one of their largest investments, reflecting ongoing interest in the company.
- Financial Performance Insights: Despite a 50% drop in stock price, Planet Fitness reported a 22% year-over-year revenue increase to $337.2 million in Q1, with adjusted EBITDA rising nearly 20%, showcasing the company's growth potential amidst market challenges.
- Market Challenges and Outlook: Management acknowledged a slower-than-expected start to 2026 for member growth, prompting a pause on planned price increases, yet the CEO emphasized a positive long-term outlook, anticipating benefits from rising health and wellness trends.
See More
Dorsal Capital Reduces Stake in Planet Fitness
- Stake Reduction: Dorsal Capital sold 225,000 shares of Planet Fitness in Q1, with an estimated transaction value of $19.78 million, indicating a potential decline in market confidence towards the company.
- Value Decline: The quarter-end value of Dorsal Capital's position in Planet Fitness decreased by $110.48 million, reflecting the negative impact of trading activities and price fluctuations on the investment portfolio.
- Performance Growth: Despite facing challenges, Planet Fitness reported a 22% year-over-year revenue increase to $337.2 million in Q1, while adjusted EBITDA rose nearly 20%, demonstrating the company's ongoing growth potential.
- Market Outlook and Challenges: CEO Colleen Keating noted that net member growth has started slower than expected in 2026; however, Planet Fitness's long-term strategy remains solid, positioning the company to benefit from the growing health and wellness trend.
See More
Planet Fitness Issues Weaker-Than-Expected Earnings Outlook
- Earnings Outlook Downgrade: Planet Fitness's FY 2026 earnings outlook was revised downward, projecting adjusted EPS growth of only 9%-10%, contrary to CFO Jay Stasz's earlier guidance, resulting in a significant drop in investor confidence and stock price.
- Revenue Growth Expectations: While the company had previously anticipated approximately 9% total revenue growth for 2025, the extended equipment replacement cycle, sale of eight corporate-owned clubs in California, and weather disruptions affecting around 2,000 clubs have severely impacted the 2026 earnings forecast, undermining market performance.
- Share Buyback Plan: Planet Fitness plans to repurchase approximately $150 million worth of shares in 2026, aiming to bolster investor confidence and stabilize stock prices; however, this initiative is overshadowed by the negative market reaction to the downgraded outlook.
- Legal Investigation Initiated: Levi & Korsinsky LLP is investigating whether Planet Fitness failed to adequately disclose material information when issuing its initial earnings guidance, potentially leading to investor losses and exacerbating market unease.
See More
Planet Fitness Issues Weaker Earnings Outlook, Investors Urged to Act
- Earnings Outlook Downgrade: Planet Fitness's FY 2026 earnings outlook was revised downward, projecting only 9%-10% adjusted EPS growth, which significantly undermined investor confidence and led to a sharp drop in stock price.
- Revenue Growth Expectations: Although CFO Jay Stasz previously indicated a projected 9% total revenue growth for 2026 during the Q4 2025 earnings call, actual performance may fall well short due to an extended equipment replacement cycle and other adverse factors.
- Shareholder Loss Investigation: Levi & Korsinsky is investigating whether Planet Fitness failed to disclose material information to investors, resulting in significant losses for shareholders after the stock price decline, potentially facing securities fraud allegations.
- Future Plans Hampered: The company plans to repurchase approximately $150 million in shares in 2026, but the sale of eight corporate-owned clubs in California and weather-related disruptions may severely impact future equipment placements and financial health.
See More
