Here's Why You Should Retain Planet Fitness (PLNT) Stock for Now

Core Viewpoint - Planet Fitness, Inc. (PLNT) has experienced a significant stock price increase of 35.6% over the past year, outperforming the Zacks Leisure and Recreation Services industry's growth of 1.9%, primarily due to its new growth model, effective pricing strategies, and international expansion efforts [1]. Factors Supporting PLNT's Uptrend - Strategic Growth Model: In 2023, Planet Fitness developed a new growth model aimed at enhancing returns from new stores by reducing capital requirements and operating expenses. The company aims to lower new unit and remodeling costs by at least 10% by the end of 2024 [3][4]. - Pricing Strategies: The company has implemented effective pricing strategies to mitigate inflation impacts, including a price increase for its Classic Card membership from $10 to $15, effective summer 2024 for new members. This is expected to lead to low to mid-single-digit percentage increases in average unit volumes for existing stores and a greater impact for new stores [5][6]. - International Expansion Efforts: Planet Fitness is actively expanding internationally, with its first European club opened in Barcelona, Spain. The company plans to open 140-150 new stores in 2024, including both franchise and corporate locations, having already opened 43 new stores in the first half of 2024 [7][8]. Concerns - Persisting Inflation: The company faces challenges due to ongoing inflation, which affects shipping, labor, and equipment costs, potentially impacting profitability. The uncertainty surrounding the ability to offset these cost increases remains a concern [9]. - Macroeconomic Risks: The reliance on franchisees introduces risks, including potential damage to the brand from third-party actions and vulnerabilities related to intellectual property violations [10].