The COVID-19 restrictions are being relaxed and the leisure sector is recovering, but not all participants in the industry stand to benefit. Peloton Interactive (NASDAQ) has just cut its guidance as it released earnings. There are also stocks like Acushnet Holdings and Vista Outdoor. Johnson Outdoors (NASDAQ:), which are well-positioned to see significant gains in the coming months.In its most recent earnings report, released last Thursday, interactive fitness products provider Peloton Interactive, Inc.’s (PTON) revenue grew 6.2% year-over-year to $805.2 million in the fiscal 2022 first quarter ended September 30, 2021. However, the company’s net loss came in at $376 million, compared to an income of $69.30 million in the year-ago period. Its loss per share was $1.25, which is a decrease from $0.20 in its prior-year quarter. Moreover, PTON’s 34.06% trailing-12-month gross profit margin is lower than the industry average of 35.79%. Additionally, PTON’s trailing-12 month EBITDA margin (and net income margin) are both negative.

Over the last nine months, the stock lost over 60%. Thornton Law Firm, on 9 November 2021 announced that it was investigating the company in relation to possible securities disclosure violations. Its forward EV/S is also 159.7% greater than the 1.48x industry-average. Additionally, the 3.40x forward EV/S rate is 159.9% lower than that of the 1.31x average industry. So, it’s wise to avoid PTON for now.

Analysts predict that overall earnings will grow by 23% annually over the next five-years. This industry will benefit in the immediate future from COVID-19’s easing, deferred demand and a improving labor market. With the unemployment rate at 4.6%, October’s job report exceeded all expectations. In 2021, the number of people working in leisure and hospitality has increased by 2.42 million.

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