Shares of Life Time Group, the gym operator based in Chanhassen, Minn., experienced a drop in value following the release of their sales outlook for the current quarter. The stock fell over 11% to $12.69 during morning trading. Despite this decline, shares remain up by nearly 6% for the year.
Fourth Quarter Forecast Disappoints Analysts
Life Time forecasted fourth-quarter revenue within the range of $555 million to $565 million, a significant increase of almost 19% from the previous year. However, this fell short of analysts’ expectations of $576.6 million, as reported by FactSet.
Full Year Revenue Target Also Below Analysts’ Estimates
The Chanhassen-based company aims to achieve a revenue target of $2.21 billion to $2.22 billion for the full year, which is slightly below the $2.24 billion anticipated by analysts.
Third Quarter Highlights
In the third quarter, Life Time reported revenue of $585.2 million, representing an 18% surge compared to the previous year. However, profit declined to 4 cents per share from 12 cents per share, mainly due to stock-based compensation and sale-leaseback deals. The adjusted earnings of 13 cents per share met analysts’ expectations.