As Annualized Recurring Revenue Per Household In Q1 2023 More Than Triples YOY to $1,650, Analyst Firm Issues Buy Rating For Interactive Strength Inc. (NASDAQ: TRNR - "FORME")

Interactive Strength Inc. (NASDAQ: TRNR) doing business as FORME, has been issued a buy rating by an analyst at Aegis Capital Corporation. FORME is a leading maker of premium smart home gyms with a differentiated offering through virtual personal training services that recently completed an initial public offering (IPO) at $8 a share.

The advisory and financial services company has issued a target price of $12 per share, which is a 322% increase in valuation from its share price today. This rating came as FORME released its quarterly results for Q1 2023, the quarter preceding the company’s IPO. In it, the company showed strong performance with its average annualized recurring revenue per household more than tripling year-over-year (YoY) to $1,650, which is higher than its competitors by 3x with a lower cost base, allowing FORME to have a higher return on capital. FORME also secured a senior loan of up to $15 million on good terms, which they believe will fund the Company well into 2024.

FORME’s Position In Personal Training, the “Luxury” of Fitness

FORME is looking to become a leader in the personal training and premium smart home gym segment of the fitness industry, with the luxury part of fitness accounting for about 70% of its revenue. The global online/virtual fitness market is predicted to grow from $14.9 billion to $250 billion between 2022 and 2032, at a compound annual growth rate (CAGR) of 32.7% during the forecast period.  

“We are excited to be presenting our first quarter results as a public company and to announce additional funding on attractive terms that underscore the potential of FORME’s combination of premium smart home gyms and virtual personal training,” said Trent Ward, the co-founder and CEO of FORME. 

He continued, “The average annualized recurring revenue per household more than tripled to $1,650, reflecting the impact of our strategy to introduce higher revenue training services to our premium smart home gyms. We believe this focus on generating significantly higher recurring revenue per customer than our peers will be the biggest driver toward our future profitability.”

As part of the company’s luxury fitness service, it offers live, 1:1 coaching sessions with its certified personal trainers. FORME also provides cutting-edge smart home gym mirrors, and the training service can be accessed either through the hardware or with FORME’s iOS and Android app. 

The company began its expansion plan into Europe recently, collaborating with Aethos hotels to bring its FORME smart gym mirrors and its personal trainer service to Italy and Portugal hotels for Aethos customers and club members. It also partnered with SIGNA Sports United (NYSE: SSU), a European specialist sports company with over 80 online services sites and 6 million customers.

For additional information on FORME’s products and services, visit the company’s website at www.formelife.com. 

Companies also active in the digital health sector include Lululemon Athletica Inc. (NASDAQ: LULU), Peloton Interactive Inc. (NASDAQ: PTON) and Xponential Fitness, Inc. (NASDAQ: XPOF).

Featured photo by Nicholas Cappello on Unsplash.
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