Life Time Group Holdings, Inc.
LTH
$43.48
-4.04%
Life Time Group Holdings, Inc. is a lifestyle and leisure brand that designs, builds, and operates large, multi-use sports, athletic, fitness, family recreation, and spa centers in a resort-like environment, primarily in residential areas across the United States and Canada. The company differentiates itself as a premium, destination-based health and wellness provider, targeting affluent consumers with a comprehensive ecosystem of fitness, athletic, and social experiences. Currently, the investor narrative centers on the company's robust post-pandemic recovery, with strong membership growth and pricing power driving significant revenue and margin expansion, while the stock has surged over 57% in the past year, reflecting optimism about its continued growth trajectory and operational leverage. However, concerns about its high debt load and capital-intensive expansion model remain key points of debate among investors.…
LTH
Life Time Group Holdings, Inc.
$43.48
Investment Opinion: Should I buy LTH Today?
Rating: Buy. LTH is a high-growth consumer cyclical with strong operational momentum and a favorable risk-reward profile. The consensus Strong Buy rating and average target of $48.14 support this view, implying 6.7% upside from current levels.
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LTH 12-Month Price Forecast
The AI model assesses LTH as bullish with medium confidence, driven by strong operational performance and attractive valuation metrics. However, the high debt and negative FCF temper enthusiasm. The stance would be upgraded if FCF turns positive and revenue growth accelerates, while a downgrade would occur if margins compress or leverage increases significantly.
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 $53.43 and implied upside of +22.9% versus the current price.
Average Target
$53.43
0 analysts
Implied Upside
+22.9%
vs. current price
Analyst Count
—
covering this stock
Price Range
$39 - $64
Analyst target range
Life Time is covered by 14 analysts, with a consensus recommendation of 'Strong Buy' (mean rating of 1.31 on a 1-5 scale). The average price target is $48.14, implying an upside of 6.7% from the current price of $45.10. The distribution of ratings is heavily skewed toward buy, with no sell ratings, reflecting a bullish sentiment among analysts. The high target of $63.00 suggests that some analysts see significant upside potential, likely driven by continued membership growth and margin expansion, while the low target of $34.00 implies a downside risk of -24.6%, possibly due to concerns about high leverage or economic downturn. The wide spread between the low and high targets (85% range) indicates high uncertainty about the company's future performance, which is typical for a high-growth, capital-intensive business. Recent institutional actions show upgrades from Morgan Stanley (from Equal Weight to Overweight in October 2025) and consistent Buy ratings from Guggenheim, indicating growing confidence in the company's strategy.
Bulls vs Bears: LTH Investment Factors
Life Time presents a compelling growth story with strong revenue acceleration, margin expansion, and a bullish analyst consensus. However, the high debt load, negative free cash flow, and aggressive growth expectations introduce significant risks. Currently, the bull case has stronger evidence given the consistent operational performance and low PEG ratio, but the key tension lies in whether the company can sustain its growth trajectory while managing its leverage. If membership growth decelerates or interest rates rise, the stock could face a sharp re-rating. Conversely, continued execution could drive further upside toward the high target.
Bullish
- Strong Revenue Growth: Q4 2025 revenue grew 12.33% YoY to $745.1 million, with sequential acceleration from $706.0 million in Q1 2025. This demonstrates robust demand for premium fitness experiences and successful pricing power.
- Exceptional Profitability: Net margin reached 16.5% in Q4 2025, up from 5.6% in Q4 2024. Operating margin expanded to 17.4% from 13.1% a year ago, showing strong operational leverage.
- Low PEG Ratio: With a PEG ratio of 0.13, the stock appears undervalued relative to its expected earnings growth. Forward PE of 22.4x is reasonable for a company with projected EPS growth of ~44%.
- Analyst Strong Buy Consensus: 14 analysts rate LTH a Strong Buy (mean 1.31), with an average target of $48.14, implying 6.7% upside. No sell ratings and recent upgrades from Morgan Stanley and Guggenheim signal growing confidence.
Bearish
- High Debt Levels: Debt-to-equity ratio stands at 2.16, indicating significant leverage. Interest expenses of $16.9 million in Q4 2025 consume a notable portion of operating income, increasing financial risk.
- Negative Free Cash Flow: TTM free cash flow is -$20.96 million, reflecting heavy capital expenditures for expansion. This limits financial flexibility and may pressure liquidity if growth slows.
- Aggressive Growth Expectations: Forward PE of 22.4x implies ~44% EPS growth, which may be optimistic. If growth disappoints, the stock could face multiple compression.
- Low Current Ratio: Current ratio of 0.63 indicates potential liquidity concerns, as current liabilities exceed current assets. This could strain operations during economic downturns.
LTH Technical Analysis
Life Time's stock is in a powerful uptrend, with a 1-year price change of +57.03% and a 6-month change of +54.61%, significantly outperforming the S&P 500's 18.19% gain over the same period. The current price of $45.10 sits at 95.5% of its 52-week range (low: $24.14, high: $47.235), indicating that the stock is trading near its highs, which typically reflects strong momentum but also raises the risk of overextension. The stock's relative strength over 1-year is +38.84%, underscoring its leadership within the consumer cyclical sector.
Beta
1.50
1.50x market volatility
Max Drawdown
-19.2%
Largest decline past year
52-Week Range
$24-$47
Price range past year
Annual Return
+61.1%
Cumulative gain past year
| Period | LTH Return | S&P 500 |
|---|---|---|
| 1m | +3.6% | +2.8% |
| 3m | +36.2% | +4.2% |
| 6m | +45.8% | +11.3% |
| 1y | +61.1% | +21.5% |
| ytd | +62.9% | +12.7% |
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LTH Fundamental Analysis
Revenue growth has been robust, with the most recent quarter (Q4 2025) reporting revenue of $745.1 million, a 12.33% YoY increase, and the trailing twelve-month revenue is estimated at $4.56 billion. Over the past four quarters, revenue has grown sequentially from $706.0 million in Q1 2025 to $745.1 million in Q4 2025, indicating accelerating momentum. The growth is driven primarily by membership revenue (which accounts for $535.1 million of the quarter's total) and in-center spending, reflecting strong consumer demand for premium fitness experiences. This consistent growth trajectory supports the investment case for continued market share gains in the fragmented health club industry.
Quarterly Revenue
$745096000.0B
2025-12
Revenue YoY Growth
+12.3%
YoY Comparison
Gross Margin
N/A
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 that Life Time is profitable (net income of $123 million in Q4 2025), the PE ratio is the most appropriate valuation metric. The trailing PE is 15.54x, while the forward PE is 22.41x, implying that the market expects earnings to grow substantially over the next year, as the forward earnings estimate is $3.18 per share. The gap between trailing and forward PE suggests a forward earnings growth rate of approximately 44%, which is aggressive and reflects high growth expectations. The PEG ratio of 0.13 is exceptionally low, indicating that the stock may be undervalued relative to its expected earnings growth, though this could also signal that growth estimates are overly optimistic.
PE
15.5x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 12x~42x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
15.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are elevated due to LTH's high leverage (debt-to-equity of 2.16) and negative free cash flow of -$20.96 million TTM. The company's capital-intensive expansion model requires significant ongoing investment, and interest expenses of $16.9 million in Q4 2025 reduce net income. A current ratio of 0.63 suggests potential liquidity stress, especially if revenue growth stalls. However, improving margins (net margin up from 5.6% to 16.5% YoY) provide some cushion, but any economic downturn could pressure membership retention and in-center spending, impacting cash flows.
FAQ
Key risks include high financial leverage (debt-to-equity of 2.16), negative free cash flow, and sensitivity to economic cycles. Competitive pressures from low-cost gyms could impact membership growth. Additionally, the stock's high valuation leaves little room for error; any disappointment in earnings could lead to multiple compression. The most severe risk is a recession causing membership cancellations and liquidity issues.
The 12-month forecast is bullish, with a base case target of $48.14 (50% probability), bull case of $63 (30% probability), and bear case of $34 (20% probability). The most likely scenario is continued steady growth, supported by strong operational performance and analyst optimism. However, the wide range reflects uncertainty, and investors should monitor quarterly results for signs of acceleration or deceleration.
LTH's trailing PE of 15.5x and forward PE of 22.4x are reasonable for a company with expected EPS growth of ~44%. The PEG ratio of 0.13 suggests the stock is undervalued relative to its growth prospects. Compared to the broader market, LTH trades at a premium, but this is justified by its superior growth and margin expansion. The market expects continued strong performance, and if growth meets expectations, the stock is fairly valued.
LTH is a good buy for investors seeking growth at a reasonable price, given its PEG ratio of 0.13 and strong revenue growth of 12.3% YoY. The analyst consensus is Strong Buy with an average target of $48.14, implying 6.7% upside. However, the high debt and negative free cash flow are risks. For risk-tolerant investors with a long-term horizon, LTH offers attractive upside potential, but those with lower risk tolerance may want to wait for a pullback.
LTH is better suited for long-term investment due to its growth stage and capital-intensive business model. The stock has high volatility (beta not provided, but strong price swings), making it less ideal for short-term trading. With a dividend yield of 0%, investors rely on capital appreciation. A minimum holding period of 3-5 years is recommended to allow the expansion strategy to play out and benefit from compounding growth.