Shares of Peloton saw a significant surge of over 11% on Wednesday following remarks from David Einhorn, the founder of Greenlight Capital, suggesting the stock is significantly undervalued.
Einhorn, a well-known hedge fund manager, made his case for Peloton during the Robin Hood Investors Conference, while notably riding one of the company’s iconic exercise bikes, according to a source familiar with the event.
Einhorn’s comments come as Peloton, known for its popular Bike and Tread machines, is in the midst of a turnaround and leadership transition. The company is currently being managed by two board members after the departure of CEO Barry McCarthy earlier this year. A new CEO is expected to be named before the year’s end.
Over the summer, Greenlight Capital disclosed a $6.8 million stake in Peloton as of June 30, signaling the hedge fund’s confidence in the company. While it is unclear what price Einhorn believes Peloton shares should trade at, his remarks appear to have resonated with investors, driving the stock higher.
Peloton has experienced volatility in its stock performance throughout 2023, but as of Tuesday’s close, it was up just over 1% for the year. The company’s recent move to partner with Costco, selling its premium Bike+ model both in stores and online, aims to expand its market reach to younger, affluent consumers.
With input from CNBC.
