In early February, The Beachbody Company announced its intentions to merge with both SPAC company Forest Road Acquisition Corp. (NYSE: FRX) and Myx Fitness in a reverse merger. The merger was valued at $2.9 Billion and was to raise approximately $420 million for the combined company.
On the 28 June, Beach Body Company had their debut on Wallstreet (NYSE:BODY) as the new parent company of Beachbody On Demand (BOD), Openfit and Myx. However, since the companies debut the stock has struggled to maintain its pre merger momentum. The stock is currently trading 25% lower than its PIPE offering price of $10.
Investors are now asking if the stock can bounce back after its recent performance. This article will breakdown everything investors need to know about the BeachBody stock forecast (NYSE:BODY).
Table of contents
Beachbody Company Stock Forecast (NYSE:BODY)
Firstly, The Beachbody Company has been able to position their brand effectively in areas such as digital subscription, consumer health and connected fitness. The company boasts 2.6 million paid digital subscriptions, which surged 30-40% as a result of COVID-19. Furthermore, current forecasts suggest the online fitness industry will grow to $59 Billion in market value by 2027.
However, investors are excited about the strong revenue opportunities the combined company can bring to the table. Looking forward into 2021, the combined company expects to generate $1.11 Billion in revenue and grow to 3.7 Million digital subscriptions. In addition, the company expects revenue to grow to $1.4 Billion in 2022 and $1.95 Billion by 2023 (representing YOY growth of 30%).
By 2025, the company expects to generate upwards of $3.29 Billion and amass 10.9 million digital subscribers. (See above data from The Beach Body’s Investor Presentation).
The risks involved with BeachBody stock
Firstly, it’s important to note the forecasts above are a reflection of future variables taking place. In contrast, we have seen the volatility the stock has experienced over the past few months.
Since the companies debut, the stock has dropped 40% now balancing around $7.50. We have seen a trend of post-merged (SPAC) companies trading lower than their PIPE offering price.
A few examples include merged company Clover Health (NASDAQ:CLOV) and indie Semiconductor (NASAQ:INDI). Therefore, investors should always tread with caution and can expect future volatility as the company moves through 2021.
Summarising the BeachBody stock forecast
In summary, the strategic positioning of the combined company looks to be a real threat to its competition including Peloton.
In addition, the 30% YOY growth in revenue over the next 4 years is a green light for long term investors. However, the associated risk with SPAC companies in the current market does expose investors to additional volatility.
Written by Tyger Fitzpatrick, Founder of Youth Investment Group.
The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
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