Life Time Group Holdings, Inc.
LTH
$31.34
-5.26%
Life Time Group Holdings, Inc. is a lifestyle and leisure brand that designs, builds, and operates large, multi-use athletic and fitness centers in a resort-like environment, primarily in residential metropolitan areas across the United States and Canada. The company has established itself as a distinctive player in the premium fitness and wellness industry, differentiating itself through its large-scale, amenity-rich facilities that combine professional fitness, family recreation, and spa services. The current investor narrative revolves around the company's post-pandemic recovery and growth trajectory, with recent quarterly results showing a significant year-over-year revenue increase, which is driving debate on the sustainability of its margin expansion and cash flow generation as it continues to scale its operations and capitalize on the wellness trend.…
LTH
Life Time Group Holdings, Inc.
$31.34
LTH 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Life Time Group Holdings, Inc.'s 12-month outlook, with a consensus price target around $40.74 and implied upside of +30.0% versus the current price.
Average Target
$40.74
5 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
5
covering this stock
Price Range
$25 - $41
Analyst target range
Analyst coverage for Life Time is limited, with only 5 analysts providing estimates, indicating it is a mid-cap stock with less institutional following, which can contribute to higher volatility. The consensus sentiment appears bullish, as evidenced by recent institutional ratings from firms like Morgan Stanley (Overweight), Guggenheim (Buy), and Mizuho (Outperform). The average revenue estimate for the next period is approximately $4.13 billion, with an average EPS estimate of $1.85, pointing to expectations of continued top-line growth and significant earnings expansion from the trailing EPS of $0.0645. The implied upside from the current price to a consensus target is not explicitly provided in the data, but the recent price surge of 19% in one month may have already captured near-term optimism. The target price range, based on EPS estimates, has a low of $1.79 and a high of $1.91, representing a relatively tight spread of about 6.9%, which suggests a reasonable degree of consensus on near-term earnings potential among the covering analysts. The recent upgrade from Morgan Stanley from Equal Weight to Overweight in October 2025 is a positive signal, reinforcing the bullish narrative around the company's execution and growth prospects.
Bulls vs Bears: LTH Investment Factors
The bull case, currently supported by stronger evidence, hinges on LTH's successful execution of its post-pandemic recovery, demonstrated by robust 12.3% revenue growth and expanding operating margins to 17.4%. Powerful technical momentum and analyst upgrades reinforce this positive narrative. However, the bear case presents substantial risks, primarily centered on the company's leveraged balance sheet (Debt/Equity of 2.16) and its cash-intensive growth model, which results in negative free cash flow. The single most important tension in the investment debate is whether the company's heavy capital expenditures, funded by debt and operating cash flow, will generate sufficient future returns (member growth, revenue) to deleverage the balance sheet and transition to sustainable positive free cash flow. The resolution of this capital efficiency question will ultimately determine if the current growth trajectory justifies the valuation and financial risk.
Bullish
- Strong Revenue Growth & Operating Leverage: Q4 2025 revenue grew 12.33% YoY to $745.1 million, with sequential quarterly increases throughout the year. This growth is translating into expanding profitability, as evidenced by the operating margin improving to 17.38% in Q4 2025 from 13.11% a year earlier, demonstrating effective cost control and scale benefits.
- Powerful Technical Breakout & Momentum: The stock has surged 19.08% in the past month and 27.71% over six months, decisively breaking out from a consolidation range. It now trades at $32.95, near its 52-week high of $35.33, indicating strong bullish conviction and positive momentum that has significantly outpaced the S&P 500.
- Analyst Upgrades & Bullish Consensus: Recent institutional sentiment is positive, with Morgan Stanley upgrading the stock to Overweight in October 2025. Analysts project significant earnings expansion, with a forward EPS estimate of $1.85, a substantial increase from the trailing EPS of $0.0645, signaling strong confidence in future profitability.
- Reasonable Valuation Post-Recovery: The trailing P/E of 15.51x is moderate and sits between its own historical extremes (high of 94x, low of 11.9x). The forward P/E of 16.89x, based on the $1.85 EPS estimate, implies a forward-looking valuation that is not excessive for a company demonstrating accelerating growth and margin expansion.
Bearish
- High Financial Leverage & Weak Liquidity: The balance sheet carries significant debt, with a debt-to-equity ratio of 2.16. Liquidity is a concern, with a current ratio of 0.63, indicating potential difficulty in meeting short-term obligations without additional financing or cash flow.
- Negative Free Cash Flow & Heavy Capex: Despite strong operating cash flow, free cash flow is negative (-$20.96 million TTM) due to massive capital expenditures. This heavy investment cycle ($304.5 million in Q4) must successfully translate into future revenue and member growth to justify the ongoing cash burn.
- High Volatility & Market Sensitivity: The stock's beta of 1.495 means it is approximately 50% more volatile than the broader market. This high sensitivity makes it prone to larger swings during market downturns, as evidenced by its 1-year performance of +15.4% lagging the S&P 500's +27.4%.
- Limited Analyst Coverage & High Short Interest: Only 5 analysts provide estimates, indicating lower institutional following which can exacerbate volatility. A short ratio of 6.44 suggests a significant portion of the float is sold short, reflecting skepticism about the sustainability of the recent rally and creating potential for a squeeze or amplified sell-offs.
LTH Technical Analysis
The stock is in a sustained uptrend, evidenced by a 1-year price change of 15.41% and a 6-month gain of 27.71%. As of the latest close at $32.95, the price is trading at approximately 79% of its 52-week range ($24.14 - $35.33), indicating it is closer to its yearly high and reflecting strong bullish momentum. This positioning near the upper bound of its range suggests the stock is exhibiting strength, though it may also face resistance near the 52-week high level. Recent short-term momentum has been exceptionally strong, with the stock surging 19.08% over the past month and 13.82% over the past three months, significantly outpacing the S&P 500's gains of 5.49% and 7.73% over the same periods, respectively. This acceleration, highlighted by a dramatic breakout from a consolidation range around $26-$29 in early May 2026, signals a powerful bullish impulse that diverges positively from its longer-term trend. The stock's beta of 1.495 indicates it is approximately 50% more volatile than the broader market, which is important for risk management as it implies larger price swings. Key technical levels to watch are support at the 52-week low of $24.14 and resistance at the 52-week high of $35.33; a decisive breakout above $35.33 would confirm the bullish trend's continuation, while a failure to hold recent gains could see a retest of support near the $30 level established during the May rally.
Beta
1.50
1.50x market volatility
Max Drawdown
-25.4%
Largest decline past year
52-Week Range
$24-$35
Price range past year
Annual Return
+9.6%
Cumulative gain past year
| Period | LTH Return | S&P 500 |
|---|---|---|
| 1m | +17.5% | +5.3% |
| 3m | +19.8% | +11.5% |
| 6m | +17.2% | +10.9% |
| 1y | +9.6% | +28.7% |
| ytd | +17.4% | +11.2% |
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LTH Fundamental Analysis
Life Time's revenue trajectory is robust, with Q4 2025 revenue reaching $745.1 million, representing a 12.33% year-over-year growth. This growth has been consistent, with quarterly revenue increasing sequentially from $706.0 million in Q1 2025 to the Q4 peak, indicating a strong operational recovery and expansion. The company's Membership segment, at $535.1 million, is the primary revenue driver, while In-Center and other services contribute significantly, showcasing a diversified model within its ecosystem. Profitability has improved markedly, with net income for Q4 2025 at $123.0 million and a trailing twelve-month EPS of $0.0645. The gross margin for the quarter was an exceptionally high 214.09%, though this appears to be a data anomaly; the more standard quarterly gross profit ratio figures from the income statements hover around 47-48%, indicating healthy underlying profitability. Operating margins have also strengthened, with the Q4 2025 operating margin at 17.38%, up from 13.11% in the year-ago quarter, demonstrating effective cost management and operating leverage. The balance sheet shows a leveraged but improving position, with a debt-to-equity ratio of 2.16 and a current ratio of 0.63, indicating potential liquidity constraints. However, the company generated substantial operating cash flow of $239.9 million in Q4 2025, though free cash flow was negative at -$20.96 million TTM due to significant capital expenditures of $304.5 million in the same quarter, reflecting its ongoing investment in property, plant, and equipment for growth. Return on equity stands at 11.95%, showing reasonable efficiency in using shareholder capital.
Quarterly Revenue
$745096000.0B
2025-12
Revenue YoY Growth
+0.12%
YoY Comparison
Gross Margin
+2.14%
Latest Quarter
Free Cash Flow
$-20958000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is LTH Overvalued?
Given the company's positive net income, the primary valuation metric is the Price-to-Earnings (P/E) ratio. The trailing P/E ratio is 15.51x, while the forward P/E is slightly higher at 16.89x, suggesting the market anticipates modest earnings growth. The forward P/E is based on an estimated EPS of $1.8488 for the next period, implying a forward-looking earnings growth expectation. Compared to the broader Consumer Cyclical sector, a trailing P/E of 15.5x appears reasonable, though a direct industry average is not provided in the data; the premium implied by the forward multiple suggests expectations of continued earnings expansion. The stock's Price-to-Sales (P/S) ratio of 1.93x and EV/Sales of 3.70x provide additional context, indicating the market values each dollar of sales at a moderate premium. Historically, the stock's own valuation has fluctuated significantly; its current trailing P/E of 15.51x is below the historical high of over 94x seen in late 2023 but above the lows near 11.9x from late 2025. This places the current valuation in a moderate zone within its own historical range, suggesting it is neither excessively cheap nor expensive based on its own history, but rather priced for steady growth following its recovery phase.
PE
15.5x
Latest Quarter
vs. Historical
High-End
5-Year PE Range -273x~94x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
15.8x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks are pronounced. Life Time operates with high financial leverage, evidenced by a debt-to-equity ratio of 2.16, which increases interest expense sensitivity and refinancing risk. While operating cash flow is strong at $239.9 million for Q4 2025, the company is in a significant investment phase, with capital expenditures of $304.5 million in the same quarter leading to negative free cash flow TTM. This creates dependency on continued access to capital markets. Furthermore, liquidity is tight with a current ratio of 0.63, indicating potential strain in covering short-term liabilities without relying on operational income or new financing.
Market & Competitive Risks are elevated due to LTH's status as a premium, discretionary consumer cyclical stock. Its beta of 1.495 indicates high sensitivity to broader market movements; a downturn could disproportionately impact membership renewals and new sign-ups. The stock's recent 19% monthly surge has compressed valuation upside and increased vulnerability to profit-taking. As a leisure company, it faces constant competition from lower-cost gym alternatives and evolving home fitness trends. The limited analyst coverage (only 5 analysts) can lead to less efficient price discovery and higher volatility, as seen with the high short ratio of 6.44.
The Worst-Case Scenario involves a combination of a macroeconomic slowdown reducing discretionary spending, coupled with the company failing to achieve the member growth needed from its new capex-heavy locations. This could trigger a double hit: revenue growth deceleration and margin compression, while high fixed debt costs remain. In this adverse scenario, investor sentiment could sour rapidly, leading to multiple compression. A realistic downside could see the stock re-testing its 52-week low of $24.14, which represents a potential loss of approximately -27% from the current price of $32.95. A breach below that level could see further declines toward the $20 range if leverage concerns intensify.