Peloton (PTON.US) stock surged more than 12% after the fitness equipment maker announced it will buy its competitor Precor for $420 million. Precor makes cardio and weight machines, and ranks among the largest commercial suppliers of fitness equipment in the world. The deal expands Peloton's manufacturing capabilities, grows its potential customer base, and benefits from Precor's experience and research/development teams. The company also expects to generate more sales of equipment and subscriptions to gyms, hotels, colleges, and other commercial customers.The acquisition prompted KeyBanc Capital Markets to raise its price target on Peloton from $160 to a Street-high $185, saying the deal was “highly synergistic” and supportive of long-term growth.
Peloton (PTON.US) stock launched today's session with a massive bullish price gap and painted a fresh ATH at $166.35. Stock has pulled back a bit since. Should a bigger downward correction start, the nearest key support to watch lies at the $144.50 level. Source: xStation5
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