While the broader markets sank on Friday, March 27, Peloton (PTON) rose nearly 9% and bucked the trend after Eric Jackson, founder of EMJ Capital, said that he is long on the stock at $4. For the uninitiated, Jackson was instrumental in fueling the rally in Opendoor Technologies (OPEN) last year. Jackson has set a base-case target price of $8 on PTON, while the bull-case target is $16.
Notably, in February, hedge fund manager David Einhorn, who sold the bulk of his Peloton holdings last year, said that he is buying the dip in the stock. PTON has a consensus rating of “Moderate Buy” from the 21 analysts polled by Barchart, and its mean target price of $8.19 is similar to Jackson’s base-case target. But could PTON stock rise above $8 in 2026? Let’s look at both the bearish and bullish arguments.
Far from reporting triple-digit revenue growth that helped its market capitalization top $50 billion at its peak, Peloton is now struggling to grow. The stay-at-home fitness industry has been on shaky ground ever since gyms reopened after the Covid-19 pandemic. Peloton’s subscription base and revenues have been falling, and in fiscal Q2 2026, its revenues fell 3% year-over-year (YoY) to $656.5 million. For context, in the corresponding period in fiscal year 2022, the company reported revenues of $1.13 billion. Its equipment sales have particularly sagged, and while subscription revenues have fared relatively better, they haven’t been able to offset the sharp decline in hardware sales.
Meanwhile, the subscription business has also been plagued by a decline in members. Peloton’s members fell to 5.8 million in the most recent quarter after having previously peaked at 7 million in fiscal Q3 2022. The paid connected fitness subscriber base has also been falling, with the churn rate rising to 1.9% in the most recent quarter.
It’s not all doom for PTON, though, as while its topline has been shrinking, the company has made a remarkable turnaround on the bottom line and posted adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) of $81 million in fiscal Q2 2026. Peloton expects its revenues to fall YoY in the current quarter but projects adjusted EBITDA to rise to between $120 million and $135 million, a YoY increase of 43% at the midpoint. It also raised its annual EBITDA guidance to between $450 million and $500 million.
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