Peloton shares hit all-time low as pressure mounts under new CEO Barry McCarthy

In this photo illustration the Peloton Interactive logo seen displayed on a smartphone screen.

Rafael Henrique | LightRocket | Getty Images

Peloton Interactive shares tumbled to an all-time low Friday as investors lose hope that the connected fitness equipment maker can turn itself around and post a profit, even under a new chief executive officer.

The stock at one point dropped more than 13%, amid a broader sell-off, to touch an all-time low of $14.70. That’s also well below Peloton’s IPO price of $29. Shares later recouped some of those losses to end trading down 8%.

Peloton is set to report its quarterly results, now with Chief Executive Barry McCarthy at the helm, on Tuesday morning.

Its market capitalization has tumbled from roughly $50 billion early last year to under $5 billion by Friday morning.

On Thursday evening, The Wall Street Journal reported that Peloton is targeting potential investors, including industry players and private equity firms, to take a stake in its business of around 15% to 20%. The fresh capital could help Peloton as it attempts a turnaround, but there is no guarantee that such a transaction will be successful, the Journal said.

A spokesperson for Peloton declined to comment.

“Though it might be nice to get a vote a confidence … we don’t see this being too encouraging for those who own the stock,” said Gordon Haskett analyst Don Bilson, regarding the Journal report. “Moves like this are rarely made from positions of strength. Desperation is more like it.”

Activist firm Blackwells Capital has been ramping up pressure on Peloton to sell itself, recently contending that the changes put into place so far under McCarthy aren’t enough. Blackwells has argued that a better owner might be Amazon or Netflix.

In a bid to win new customers and make more money from existing ones, Peloton recently dropped the prices of its Bike, Bike+ and Tread machines, while it plans to raise its monthly all-access subscription fee next month.

BMO Capital Markets analyst Simeon Siegel said turbulence has been the “one true constant” at Peloton in recent months.

“From its initial success to its ongoing strategic tests, the company has yet to find a sense of normalcy that can smooth out the recurring volatility,” he said.

Peloton shares have fallen more than 55% so far this year.