Greenlight Capital’s David Einhorn thinks Peloton could trade as high as $31.50 a share if the company slashes costs, which could double its current adjusted EBITDA projections, CNBC has learned. 

That’s about five times the current price of its shares, which were trading around $6.20 midday on Friday.

In a pitch deck Einhorn presented at the Robin Hood Investors Conference on Wednesday, Einhorn pedaled on a Peloton bike as he explained the company’s many missteps over the years and the wide runway it has to turn its business around, according to a copy of the presentation obtained by CNBC.

If it can generate $450 million in EBITDA, about double its current projections, Peloton could trade between $7.50 and $31.50 a share, based on a benchmark study of comparable companies, said Einhorn. 

Notably, Greenlight’s analysis doesn’t assume “any growth in subscription revenues from new customers or price increases or other new initiatives, such as activation fees from the growing used bike market and international expansion,” Einhorn said. 

“Facing bankruptcy can force change,” he said during the pitch. “Peloton has started to right-size and cash burn has stopped. It refinanced its debt to push out maturities. And with a loyal customer base that pays $44 per month, it’s a valuable subscription business.”

Einhorn structured the presentation as if he was an instructor giving a workout class, occasionally shouting out investors in the room. The first page of the deck was titled “15 minute ‘Stock Pitch Ride'” and shows an image of Einhorn on a Peloton bike.

“Let’s start with some shoutouts,” Einhorn said at the beginning of the pitch, calling out a number of investors and sponsors, similar to the way a Peloton instructor would call out class attendees.

Each page of the deck shows a leaderboard of other apparent riders — including investor Bill Ackman and Robin Hood CEO Richard Buery — along with Einhorn’s speed, cadence and resistance, mimicking what users see while taking a Peloton bike class.

Greenlight and Peloton declined comment to CNBC.

Greenlight, which had a $6.8 million stake in the company as of June 30, conducted a benchmark study analyzing Peloton’s cost structure. The firm compared Peloton to three sets of peer companies: fitness businesses like Planet Fitness, consumer subscription companies like Chewy, and consumer online subscription businesses like Spotify and Netflix. 

The study found that even though Peloton has already cut costs to curb its cash burn, it’s seeing “basically zero adjusted EBITDA versus the peer median of $406 million,” Einhorn stated in the pitch. 

“For peers, over a third of gross profit flows through to EBITDA. Part of the problem is that Peloton spends too much on research and development,” said Einhorn. “Just as one example, Peloton spends about twice the R&D that Adidas spends … in dollar terms. And Adidas has 8 times more sales than Peloton and an order of magnitude more product lines.” 

Peloton’s stock-based compensation expense of $305 million in fiscal 2024 is also double the peer median and comparable to far larger companies like Spotify and Netflix – which are 30 times and 140 times larger, respectively, Einhorn said. 

At the heart of the thesis is Peloton’s high-margin subscription business, which generated $1.71 billion in revenue in fiscal 2024 with a gross margin of about 68%. If Peloton can make deep cost cuts, the company could generate far more free cash flow and EBITDA without needing to sell more bikes and treadmills, and without needing to grow its subscriber base. 

Earlier this year, Peloton announced plans to lay off 15% of its staff, close retail showrooms, and adjust its international sales plans, among other cost savings initiatives. It expects those cuts could reduce annual run rate expenses by more than $200 million by the end of fiscal 2025.

In August, Peloton said it expects it can post adjusted EBITDA of between $200 million and $250 million in fiscal 2025. But Einhorn said if the company gets its cost structure more in line with the benchmark, “there should be $400 – $500 million of EBITDA from the current subscription revenue base.” 

Companies that generate that range of EBITDA tend to trade at nine to 32 times that amount, implying a potential Peloton share price of between $7.50 on the low end and $31.50 on the high end, if it reaches $450 million in EBITDA, he said. 

To get there, Einhorn said the company needs new management. In August, Peloton’s interim co-CEO Karen Boone said she believes the new top executive will be in place by the time the company next reports earnings, which are now scheduled for Thursday. 

“The nice part of our thesis is that we don’t have to convince Peloton this is the right approach,” said Einhorn. “Peloton’s interim co-CEOs are telling the same story of a recurring, high-margin subscription revenue stream business. They have also implemented an initial cost-cutting plan, which still leaves plenty of room for the new CEO.” 

He said the company continues to garner top reviews among consumers and fitness publications and has a rabidly loyal customer base. He added that even though fitness buffs are returning to the gym, home workouts are here to stay.

“Working out in the comfort of your own home is not a fad,” said Einhorn. “And a trend towards healthier lifestyles should all drive underlying subscriber growth over time.”

A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions, straight to your inbox.

Luxury king Bernard Arnault is shopping for AI companies.

Arnault, founder and CEO of LVMH and the world’s fourth-richest person with a net worth of $184 billion, has made a string of artificial intelligence investments this year through his tech-focused venture firm and family office, called Aglaé Ventures.

Aglaé made five AI-related investments in 2024, according to data provided exclusively to CNBC by Fintrx, the private wealth intelligence platform. While the amounts of Aglaé’s investments aren’t disclosed, the funding rounds for the AI firms totaled more than $300 million, according to Fintrx.

The largest funding round this year, according to Fintrx, was in a firm called H, formerly known as Holistic AI, a French startup that’s working toward full artificial general intelligence. It was founded by former members of Google’s DeepMind AI unit and includes venture firm Accel Partners LP and Wendy and Eric Schmidt, the former CEO of Google, as investors. The $220 million round in May, which also included Aglaé, valued H at $370 million, according to the company.

Aglaé also invested in a $25 million seed round for Lamini, a Palo Alto, California-based startup building enterprise AI applications. In April, Aglaé was part of a $12 million series A round for Proxima, a New York-based AI-powered digital marketing company.

Aglaé joined Susquehanna to invest in the $27 million seed round for Toronto-based Borderless AI, a human resource management platform. And, it invested in Photoroom, a France-based AI image editor, as part of a $43 million investment round in February.

While many of Aglaé’s AI investments are recent, it invested in four funding rounds between 2017 and 2019 in Paris-based Meero, an AI-powered photo creation company, according to Fintrx.

The family office’s other investments this year were in Sonarverse, an Irvine, California-based blockchain company, and Shimmer, a San Francisco-based provider of ADHD coaching.

Since 2017, Aglaé has made a total of 153 investments, according to Fintrx data, with 53 in technology, 17 in consumer goods, 13 in business services and 12 in financial services.

Its other investments include Noom, a digital health platform, and World Music Media, a music creation app. Aglaé was part of multiple rounds of funding for Back Market, a French-based marketplace for refurbished electronics products that in 2022 reported a valuation of $5.7 billion.

Since the Arnault family fortune is so heavily concentrated in LVMH, with the family owning about 48% of the shares and controlling 64% of the voting rights, Aglaé has little reason to invest in luxury.

Arnault and his family are, however, big art collectors, and Aglaé was an investor in a $9.5 million funding round for LaCollection, a digital art platform. LVMH has expanded rapidly in the luxury watch segment and Aglaé was an investor in the $108 million funding round in 2021 for watch trading platform Chrono24.

While famous for his dedication to luxury craftsmanship, historic brands, and emotional connections to designs and artists, Arnault is also a big technology fan with a history of backing successful tech startups. His family office was an early investor in Netflix in 1999, Spotify in 2014 and Airbnb in 2015.

In a speech in May at the LVMH Innovation Awards, Arnault said he invested in 75 startups in the 1990s, and “some of them made it, but many didn’t.”

“The startup mentality is very close to our values: creativity, quality — it has to work — an entrepreneurial spirit and meaning,” he said.