We recently published a list of the 12 Best Leisure Stocks to Buy Right Now. In this article, we are going to take a look at where Peloton Interactive, Inc. (NASDAQ:PTON) stands against the other best leisure stocks to buy right now.
Overview of the Global Leisure Industry
According to Allied Market Research, the global leisure travel market had a market size of $1.2 trillion in 2023. It is anticipated to grow at a compound annual growth rate of 18.3% between 2024 and 2033, reaching $6.2 trillion by the end of the forecast period. The rise of social media is one of the key reasons behind the continued growth in leisure travel, as people are gaining increasing awareness and exposure to various industry trends.
The outdoor leisure market is another significant industry in the domain. Outdoor leisure encompasses recreational open-air activities typically conducted in semi-natural or natural environments. According to Business Research Insights, the market was valued at around $13.15 billion in 2024 and is expected to grow at a compound annual growth rate of 6.95% between 2025 and 2033, reaching $24.07 billion by the end of the forecast period.
A report by Deloitte showed that the leisure industry continued to rebound in fiscal Q3 2024, with total net expenditure increasing from -10.3% in fiscal Q2 2024 to -8.5% in fiscal Q3 2024, reaching the highest level since fiscal Q1 2022. The report showed that nine out of eleven leisure categories reflected increased spending, with short holidays and eating out topping the charts with a 4.7 and 5.5 percentage points increase, respectively.
Although long vacations decreased in popularity due to economic uncertainties and growing expenses, short vacations gained public acknowledgment, as consumers are prioritizing affordability. Casual dining rose by 1.7% year on year, with three new locations opening each week. In addition, live sports, festivals, and concerts drove a 4.1 percentage point increase in net spending on culture and entertainment. Leisure activities at home and pub spending also showed increases, climbing by 1 and 1.7 percentage points, respectively.
However, Deloitte Consumer Tracker anticipates consumer spending to fall in nine out of eleven categories in fiscal Q4 2024. Longer holidays and eating out are expected to have the highest fallout, with a decrease of -8.1 points and -5.9 points, respectively. Cautious consumer spending amid potentially rising inflation and economic uncertainties is anticipated to affect the hospitality industry, necessitating value-driven tactics to attract consumers.
Our Methodology
We sifted through stock screeners, online rankings, and ETFs to compile a list of 25 leisure stocks. We then selected the top 12 with the highest number of hedge fund holders as of fiscal Q4 2024. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund sentiment.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Why Peloton Interactive (PTON) is Crashing?
A group of people in a fitness class with connected fitness products in a studio or gym.
Peloton Interactive, Inc. (NASDAQ:PTON) is a global fitness company operating an interactive fitness platform with a community of more than six million members. It offers technology-fitted and instructor-led boutique classes to members. The company operates in two segments: Connected Fitness Products and Subscription. The Connected Fitness Products segment encompasses Peloton Bike, Peloton Bike+, Peloton Tread, Peloton Tread+, Peloton Guide and Peloton Row. The subscription segment offers access to the company’s library of fitness classes.
Over 2 million members completed strength training, pilates, boot training, or yoga workouts through Peloton Interactive, Inc. (NASDAQ:PTON) in fiscal Q2 2025. Strength drove 735 million minutes of workout time in the quarter, reflecting the company’s continued popularity. It is also elevating its cardio business through efficient marketing efforts that have allowed the company to exceed its Tread portfolio sales goals and achieve higher new subscription rates on Tread and Tread+ sales year-over-year in fiscal Q2 2025.
In December, Peloton Interactive, Inc. (NASDAQ:PTON) launched Strength+, an innovative app that offers non-class strength training programs with audio guidance from expert coaches, along with a custom workout generator. In fiscal Q2 2025, the app reached over 220,000 monthly active users, and is anticipated to continue growing.
Overall, PTON ranks 1st on our list of the best leisure stocks to buy right now. While we acknowledge the potential of PTON as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PTON but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
