Come January 2nd, something magical (and entirely predictable) happens across America.
Gyms that were ghost towns in mid-December suddenly look like Black Friday at Walmart. Treadmills are occupied, the free-weight area has a line, and the poor staff are frantically wiping down equipment while handing out water bottles to people who swear “this year will be different.”
We’ve all seen it. Many of us have been it. And every year, a handful of investors quietly smile because they positioned themselves months earlier to profit from exactly this surge in human optimism.
One of the purest ways to play that phenomenon is Planet Fitness (ticker: PLNT). And right now—literally the day after Thanksgiving—there’s an options setup that costs almost nothing to enter yet gives you meaningful upside if the usual post-holiday script plays out again.
Why Planet Fitness Is the Ultimate “New Year, New Me” Stock
Let’s start with the story everyone already knows but somehow still underestimates.
Americans gain weight over the holidays. A lot of it. Studies vary, but the average is roughly 1–2 pounds between Thanksgiving and New Year’s—and for many people it’s considerably more. Then January hits and roughly 40% of adults make a resolution to get in shape. Gym sign-ups explode.
Planet Fitness sits dead-center of that behavioral wave for three big reasons.
- First, it’s dirt cheap—$15 a month (sometimes $10) is less than most people spend on coffee in a week.
- Second, the “Judgment Free Zone” branding is catnip for beginners who are terrified of getting stared at in a serious gym.
- Third, the franchise model means new locations pop up like Starbucks stores—there are already more than 2,500 in the U.S. and they’re still adding 150–200 per year.
Premium gyms keep raising prices ($100–$300/month), boutique studios struggle with churn, and traditional big-box gyms feel intimidating. Meanwhile Planet Fitness just keeps printing high-margin royalty checks while franchisees happily write.
In my experience watching consumer discretionary names for fifteen years, very few businesses convert cultural inertia into recurring revenue quite this cleanly.
The Financial Engine Behind the Purple Machines
Here’s what makes the stock especially interesting from a fundamental perspective right now.
Corporate revenue breaks down roughly like this:
- ~30% from franchise royalties and fees (very high margin)
- ~25% from corporate-owned stores
- ~35% from equipment sales to new franchisees (lumpy but high margin)
- ~10% from the Black Card upsell and annual fee
That royalty stream is the golden goose. As new clubs mature (usually 24–36 months), same-store sales comps turn positive and the royalty dollars compound. Corporate margins have expanded from the mid-20s to the mid-30s over the last five years and still have room to run.
Compare that to a capital-intensive competitor that has to fund every new location itself and you see why Planet Fitness generates so much free cash flow with relatively little debt.
Valuation: Expensive or Reasonable?
The main pushback I hear is “the stock is at all-time highs—how can you buy here?”
Fair question. Shares recently kissed $100 after a strong Q3 print. Trading at roughly 31× next year’s adjusted EPS doesn’t scream bargain.
But context matters. Consensus expects 11% revenue growth and 17–18% EPS growth next year, and the longer-term algorithm is mid-teens EPS growth through at least 2027. A mid-30s PE on a 15–18% grower in a 4–5% bond yield environment isn’t outrageous—especially when the balance sheet is clean and the business model is defensive during recessions (people trade down, not out).
I actually think the bigger risk is not owning growth compounders when they’re working.
The Options Trade: Call Spread Risk Reversal
Here’s the fun part.
Because implied volatility tends to be reasonably elevated coming out of earnings and the stock has run hard, you can structure a trade that costs little (sometimes even a credit) yet captures another 15–25% of upside over the next couple of months.
The setup I like right now (as of Nov 26 close) is a January 17 expiration 97.5 / 115 / 125 call spread risk reversal.
Structure:
- Sell the January 97.5 put
- Buy the January 115 call
- Sell the January 125 call
Net cost has been oscillating between a small debit and a small credit depending on the exact moment you look. Yesterday the package could be done for around a $0.55–$0.80 debit if you’re patient with limit orders.
Maximum loss: You could end up long stock at an effective cost basis of roughly $97 (97.5 strike minus the net premium received). That’s actually below where the stock was trading just three weeks ago before the post-earnings gap.
Maximum gain: $10.70 (distance between 115 and 125 strikes minus net debit) if shares are above $125 at January expiration—roughly 25% higher than current levels at time of writing.
Breakeven on the upside is around $115.55—only about 15% higher.
Essentially you’re getting paid (or paying very little) to own a bullish call spread that expires right as New Year’s resolution season peaks.
How to Actually Get Filled (Because PLNT Options Aren’t Apple)
Planet Fitness options aren’t the most liquid in the world. Bid/ask spreads can be $1 wide or more on spreads.
Best practice:
- Start your limit at the midpoint of the natural market.
- Wait 60–90 seconds.
- Bump the limit by the minimum increment ($0.05 usually).
- Repeat until filled.
It feels slow, but you’ll usually save $0.30–$0.70 per contract versus paying the offer. On a ten-lot that’s real money.
Risks (Because Nothing Is Free)
If the economy suddenly falls off a cliff and consumers stop spending even $15 a month, the stock could retest the low $80s. In that scenario you’re long stock at $97—painful but not fatal, and arguably still reasonable for a long-term compounder.
If the resolution crowd shows up but the stock doesn’t move (analysts already “in” the numbers), you keep the small debit as loss.
Both risks feel manageable given the asymmetry.
Final Take
Every year we overeat, swear we’ll change, and flood affordable gyms in January. Planet Fitness is the single best vehicle to monetize that utterly predictable behavior—and right now you can do it with almost no money out of pocket.
Whether you put on the full risk-reversal or simply buy a February or March call spread outright, the seasonal tailwind is real. I’ve traded this theme for years across multiple fitness names, and PLNT remains the cleanest expression.
Just don’t wait until January 5th when the story is obvious to everyone and the options are priced for perfection.
Position sizing, as always, is the difference between a fun trade and a nightmare. But if you’ve ever wanted to turn America’s annual battle with holiday weight gain into portfolio gains, this is about as good as it gets.
Happy Thanksgiving—and happy trading.
