It’s been reported that Amazon.com and Nike are weighing bids for Peloton Interactive. One analyst said he’s be surprised if Apple also wasn’t in the mix.
“We would be shocked if Apple is not aggressively involved in this potential deal process,” said Dan Ives, an analyst at Wedbush in a note released Sunday.
Acquiring Peloton (ticker: PTON) “would be a major strategic coup” for Apple (AAPL) and “catalyze the company’s aggressive health and fitness initiatives over the coming years,” Ives wrote.
“With ~2.8 million paid subscriptions today and a very strong/unique competitive moat, Apple acquiring Peloton would be both an offensive and defensive acquisition in our opinion,” the analyst added.
The Wall Street Journal was the first to report last week that Peloton was receiving interest from potential suitors, including Amazon (AMZN). The Financial Times published a story Friday that Nike (NKE) also was evaluating a bid for Peloton, the interactive-exercise company.
Peloton stock, which has fallen 83% in the past 12 months, surged 26.4% to $31.10 in after-hours trading Friday. In 2020, amid surging demand for Peloton’s bikes during lockdowns, the stock soared to above $160. But the shares have tumbled as gyms reopened. It has declined 31% year to date.
Last month, activist investor Blackwells Capital said it sent a letter to Peloton’s board suggesting the company fire CEO John Foley and explore a sale.
Ives isn’t the first to suggest that Apple could make a run at Peloton, given the tech giant’s push further into fitness. Apple was one of the companies suggested by Blackwells, as was Walt Disney (DIS), Nike and Sony (SONY).
Ives wrote Sunday that Apple — through its Fitness+ subscription service and Apple Watch strategy — “would be able to leverage the Peloton services and flywheel to significantly bulk up its healthcare initiatives which have been a key strategic linchpin for [CEO Tim] Cook.”
An acquisition of Peloton also would prevent another company from “getting their hands on Peloton,” which Ives said for Apple “would be a business model risk for its healthcare segment and future endeavors.”