Peloton Earnings Sprint by Expectations, but Stock Drops on Continued Supply Issues

Peloton Interactive (NASDAQ: PTON), the leading maker of connected home-exercise equipment, reported strong fiscal first-quarter 2021 results (for the period ended Sept. 30) after the market close on Thursday, Nov. 5.

But shares dropped 7.1% in Thursday's after-hours trading session. The market's initial reaction wasn't related to the current quarter's results, which sped by Wall Street's expectations for both revenue and earnings. Investors punished the stock because supply constraints are expected to hurt Peloton's fiscal second-quarter profitability. The company has been unable this year to keep up with demand, which has been soaring in large part due to the COVID-19 pandemic. 

In 2020, shares of Peloton -- which held its initial public offering (IPO) in September 2019 -- have gained 346% through Thursday's regular trading session. The S&P 500 has returned 10.4% over this period.

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Source Fool.com