From changing CEOs to announcing staff layoffs, it’s been a tough few days for Peloton.
On Thursday, Peloton announced it would lay off 15% of its global workforce, which will impact approximately 400 employees. The company also plans to continue closing retail showrooms in an effort to “align the company’s cost structure with the current size of its business,” according to the May 2 announcement.
The same day, the fitness company announced that Barry McCarthy would step down as CEO, president and board director just two years after succeeding founder John Foley. He will become a strategic advisor until the end of the year, according to the May 2 press release.
As the company searches for a new CEO, Peloton President Karen Boone and Peloton Director Chris Bruzzo will serve as interim co-CEOs.
How much you would have if you invested $1,000 in Peloton
Peloton has come a long way since the company was founded in 2012.
The dynamic startup quickly gained a cult following by offering stationary exercise bikes with built-in virtual classes. It made its market debut on September 26, 2019, with an opening price of $27 per share. Amid Covid-induced gym and fitness center closures, the stock price soared to an all-time intraday high of $171.09 per share on January 14, 2021.
However, a little over three years later, the decline is brutal. As of market close on May 2, Peloton stock was trading at a price of $3.13 per share.
If you had invested $1,000 in Peloton in 2019, 2021, or 2023, here’s how much it would be worth now. CNBC’s calculations are based on the company’s May 2 closing stock price of $3.13.
- If you had invested $1,000 in Peloton a year ago in 2023, your investment would have decreased by almost 64% and would be worth around $364 as of May 2.
- If you had invested $1,000 in Peloton in 2021, your investment would have fallen by about 98% and would be worth just over $18 as of May 2.
- And if you had invested $1,000 in Peloton in 2019 when it first went public, your investment would have declined by about 89% and would be worth about $108 as of May 2.
Investors should be careful not to put all their eggs in one basket
Remember, you should not use a company’s current stock performance to try to predict its future performance. Often, unpredictable factors can cause unexpected rises or falls in a company’s stock price.
This is why financial experts generally advise against selecting individual stocks to invest in on your own. A more passive investment approach makes sense to most people.
Instead, you can purchase exchange-traded funds or mutual funds. These types of funds aim to reflect a market index such as the S&P 500, which tracks the stock performance of approximately 500 major U.S. companies. With this strategy, your investment is actually spread across a wide range of top-performing companies like Apple, Microsoft, and Nvidia, rather than just one.
As of May 2, the S&P 500 was up nearly 23% from 12 months ago, according to CNBC calculations. Since 2021, it has increased by around 33% and has climbed almost 70% since 2019.
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