Bank of America downgrades Planet Fitness stock price after earnings
Planet Fitness investors received a tougher view from Bank of America after the gym operator's latest earnings update reset expectations for membership growth, pricing, and the company's near-term stock setup.
Bank of America downgraded Planet Fitness to neutral from buy and lowered its price objective to $59 from $110, according to the Bank of America note given to TheStreet. The new target still represented 34.1% upside from the $44.01 share price listed in the note, although the size of the cut showed a much more cautious outlook after earnings.
The firm said Planet Fitness lowered its 2026 outlook after weaker-than-expected first-quarter sign-ups, changes to its marketing strategy, and the decision to skip a planned Black Card price increase. Bank of America also lowered its earnings estimates, with its 2026 EPS forecast moving to $3.22 from $3.39 and its 2027 EPS forecast moving to $3.70 from $4.10.
"With new marketing initiatives likely needing time to gain traction, we see limited catalysts ahead and downgrade shares to Neutral from Buy," Bank of America said in the note.
Planet Fitness membership trends raise concerns
Planet Fitness has built one of the largest fitness club businesses in the U.S., with more than 2,890 clubs and 20.8 million members, according to the Bank of America note. The company's model centers on a high-value, low-price gym offering aimed at consumers who may not already belong to a fitness club.
That setup makes the first quarter especially important for the company's annual growth targets. Bank of America said the first quarter typically drives the majority of annual net membership additions, which made the latest membership shortfall a key part of the downgrade.
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Planet Fitness added 700,000 net new members during the quarter, according to the note, coming in below internal expectations. Management cited marketing missteps that skewed toward more fitness-focused customers instead of beginners, while March and April were also tracking below plan.
The company has engaged a new creative agency and plans to have a new campaign in the market before year-end, Bank of America's note indicated. That campaign could help set up Planet Fitness for its peak first-quarter membership period in 2027, although Bank of America said the new initiatives may take time to gain traction.
Planet Fitness Black Card price decision adds to reset
Planet Fitness also decided against implementing a planned Black Card price increase as it prioritizes membership growth. The Black Card tier is an important part of the company's business, and Bank of America said management pointed to historical near-term pressure on sign-ups when discussing the decision.
Bank of America also said Planet Fitness may be feeling the effects of a slightly softer lower-end consumer, given the company's value-oriented customer base. That concern added pressure to a 2026 outlook that was lowered across several key metrics.
Planet Fitness now expects same-club sales growth of 1%, down from a prior range of 4% to 5%, according to the Bank of America note. Revenue growth was lowered to 7% from 9%, EBITDA growth was lowered to 6% from 10%, and EPS growth was lowered to 4% from a prior range of 9% to 10%.
Those changes leave Planet Fitness with less room for error as it works through a new marketing approach. Bank of America said recent marketing missteps have driven same-club revenue growth to the low single digits from the mid-single digits, and the firm expects the new strategy to take time to ramp.
Bank of America cuts Planet Fitness estimates
Bank of America's new $59 price objective is based on 16 times its 2027 EPS estimate, according to the Bank of America note. The firm said that multiple is in line with other franchise companies, including hotels that focus more on value-oriented customers.
The firm's updated model calls for 2026 sales of $1.43 billion, EBITDA of $593 million, and adjusted net income of $253 million. For 2027, Bank of America estimates sales of $1.55 billion, EBITDA of $663 million, and adjusted net income of $287 million.
Bank of America also outlined the main risks around its new price target. Upside risks include higher club and unit growth, higher Black Card penetration rates, and lower membership churn. Downside risks include weaker new franchisee interest in opening clubs domestically and internationally, lower Black Card penetration rates, and higher membership churn.
The new call leaves Planet Fitness in a more difficult position after earnings. The company still has a large membership base, a widely known brand, and a value-focused model, although Bank of America's downgrade shows that investors may need clearer evidence that marketing changes can restart stronger membership growth before the stock gets a more bullish view again.
Related: Planet Fitness membership change prompts new stock price targets
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This story was originally published May 9, 2026 at 4:00 PM.