10 Best Fitness and Gym Stocks to Buy Now

7. Planet Fitness, Inc. (NYSE:PLNT)

Number of Hedge Fund Holders: 34

Planet Fitness, Inc. (NYSE:PLNT) operates fitness centers in the United States through three segments: Corporate-owned stores, Franchise, and Equipment. It has around 2,575 stores in 50 US states, the District of Columbia, Mexico, Panama, Puerto Rico, Australia, and Mexico.

The company’s same-club sales grew by 4.3% in fiscal Q3 2024 and delivered a 5.3% revenue growth. Its membership is gaining popularity, ending fiscal Q3 2024 with around 19.6 million members. Planet Fitness Inc. (NYSE:PLNT) is undertaking several strategies to evolve its brand and maintain its industry leadership. It is redefining its brand strategy and pulling it through marketing. It is also focusing on enhancing its member experience, refining its products, and optimizing its format. In addition, the company is accelerating new club growth.

Planet Fitness Inc. (NYSE:PLNT) boasts growth opportunities in both new and existing markets across the US. It has a long-term target of 5,000 US clubs, and is primarily based on its 20,000-square-foot traditional Planet Fitness. The company is simultaneously working on smaller footprint clubs for less populated areas and infill locations. It also has plans to grow internationally in strategic markets and is building its presence in newer markets such as Spain, Mexico, and Australia.

Vulcan Value Partners stated the following regarding Planet Fitness, Inc. (NYSE:PLNT) in its Q2 2024 investor letter:

“Planet Fitness, Inc. (NYSE:PLNT) pioneered the “high value, low price” (HVLP) gym model and operates over 2,500 gyms globally with 18.7 million members. Their straightforward, no-frills approach offers excellent value, appealing to a diverse and casual fitness demographic. Members enjoy a clean environment, regularly updated equipment, and accessible pricing starting at $10 per month, with their premium “Black Card” membership providing extensive benefits and access to all locations. Planet Fitness captured roughly 90% of US gym membership growth from 2011-2019. The company’s dominant scale coupled with high advertising spend drives powerful growth, and the company plans to double its number of US locations. Planet Fitness demonstrates robust same-store sales growth, high EBIT margins, strong returns on capital, and excellent free cash flow conversion.”