Some stocks that perhaps flew too high, too soon have been on sharp descents lately. However, some stocks have strong catalysts to rebound this month…
Peloton Interactive (NASDAQ:PTON), Zoom Video Communications (NASDAQ:ZM), and Tesla (NASDAQ:TSLA) were market darlings just a couple of weeks ago. Sentiment has turned in the recent market correction, and all three of them are now trading at least 20% below their all-time highs.
It won’t always be that way. All three have the right ingredients to get back on track. Let’s see why this trio of stocks can hit fresh highs later this year, thumping the market yet again in the process.
The first two names have a lot in common. Peloton and Zoom Video became poster children of the new normal during the early stages of the pandemic, only to be discarded when the COVID-19 vaccines started hitting the market. Let’s take Peloton for a spin first.
Peloton exploded as the high-end fitness platform at home. Its treadmills became the worthy substitute to fitness center workouts. Its even more popular stationary bikes replaced local spinning class boutiques.
Growth has been tremendous. Peloton connected fitness subscribers have soared 134% to 1.67 million members. Its cheaper digital subscriptions for folks that lack Peloton hardware is a much smaller business, but it’s growing even faster. Peloton’s now topping $1 billion in revenue every quarter, and it’s not done working up a sweat.
Peloton isn’t going anywhere once the public health crisis abates, largely because this was one pandemic play that legitimately improved on the original it was replacing. Peloton’s interactive sessions are convenient and productive. The proof is in the pudding. Investors may have rotated out of Peloton shares; the stock is 31% off of January’s peak. But workout seekers see things differently. Demand continues to outstrip supply even with vaccines on the market. The order backlog is still several weeks for new orders.
Tuesday was — well — weird for Zoom stock. The videoconferencing speedster opened 7% higher after serving up a monster quarter, only to shed 15% of its value throughout the trading day to close Tuesday out with a 9% decline.
Results for its fiscal fourth quarter were stellar. Revenue skyrocketed 369% to hit $882.5 million. If you think that’s a big number, adjusted operating income and earnings per share soared 840% and 713%, respectively.
Growth will undeniably decelerate at this point. Zoom issued guidance for the new fiscal 2022 year, and it sees revenue…
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