PLNT - Peloton falls further as treadmill recall reverberations continue

Peloton Interactive ([[PTON]] -14.9%) is down sharply after the company agreed to recall its Tread+ and Tread products earlier today.As part of the agreement with the CPSC, Peloton CEO John Foley acknowledged the company made a mistake when it initially refuted the regulator's claims.Truist Securities sees some near-term risk from the development."While details are currently sparse (pending the company's earnings release tomorrow post close), we acknowledge that this recall will likely result in significant near-term one time financial costs and operational disruption, with potential reputational damage. We estimate that PTON's Tread+ sales are less than 10% of revenue. We also believe that this move will effectively delay the official launch of the new Tread, scheduled for May 27th."Truist also observes recall comes at an unfortunate time for Peloton as the company is already incurring elevated costs on expedited shipping to combat delays and straining its supply chain.However, the big picture

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Peloton falls further as treadmill recall reverberations continue