Planet Fitness has announced Colleen Keating as its new CEO, effective June 10. Keating has 30 years of experience in operations and franchise management in various industries, including hospitality. She takes over from interim CEO Craig Benson. Analysts believe Keating’s appointment is a positive move for the company’s stock, despite a 3% drop following the announcement. Piper Sandler analyst Korinne Wolfmeyer sees Keating as a catalyst for positive changes, such as implementing a new growth model, potential pricing changes, and laying out a plan for a new CFO search.
Keating’s leadership comes at a crucial time for Planet Fitness, as it faces challenges like the increasing popularity of weight loss drugs and controversy surrounding its locker room policy. Some analysts see Keating as an unconventional yet solid choice to lead the fitness club through these challenges. She will also play a significant role in the company’s search for a new CFO, following the retirement of Tom Fitzgerald in February. Planet Fitness shares have fallen by roughly 17% this year, with some volatility since former CEO Chris Rondeau announced his departure after 10 years.
Planet Fitness will be holding its annual general meeting on April 30 and reporting first-quarter earnings on May 9. The company’s current CFO, Tom Fitzgerald, announced his retirement in February, and Keating will be key in finding a suitable replacement. Stephen Spinelli, chairman of the board of directors, expressed confidence in Keating’s ability to accelerate the company’s growth in the next phase. Analysts at William Blair have an “outperform” rating on Planet Fitness stock, highlighting Keating’s operational knowledge, strategic mindset, and understanding of franchise operations and consumer-facing brands as key strengths for the role.
Keating’s previous experience as CEO of FirstKey Homes and leadership roles at InterContinental Hotels Group and Starwood Hotels & Resorts Worldwide Inc. positions her well to navigate the challenges facing Planet Fitness. Analysts believe that Keating’s appointment could drive earnings upside and valuation appreciation for the company. Despite the recent stock price drop, there is optimism surrounding Keating’s appointment and the potential changes she may bring to the organization. The announcement of Keating as Planet Fitness’s new CEO marks a significant milestone for the company as it looks to overcome its current challenges and drive growth in the future.
