Peloton 's skid after the company announced a treadmill product recall is a buying opportunity, Credit Suisse said. Shares fell of more than 14% on Wednesday after the announcement. The exercise equipment company reached an agreement with the Consumer Product Safety Commission to voluntarily recall both models of its treadmills and to halt sales of the product following one death and dozens of injuries linked to the product. But Credit Suisse that it expects "the company to continue to grow from there." The firm also noted that while the full extent of the impact is not yet known, the company is well-positioned to endure through the recall. "For some, dealing with product returns, software updates, and manufacturing changes could be complicated. Peloton's investments and vertical integration are ideal for dealing with this type of issue (logistics, Precor, etc.)," the firm said in a note to clients Thursday. Additionally, Credit Suisse noted that the repair "does not appear complicated." A lower-priced treadmill product was slated to launch in North America later this year. The firm said the launch could be delayed, but that shouldn't result in lost sales. Peloton's stock also took a hit on Wednesday amid a broader rotation out of growth-oriented areas of the market, according to Credit Suisse. The firm has an outperform rating and $164 target on the stock, which is nearly 100% above where shares closed on Wednesday. Peloton's sell-off has divided the Street: Baird and Stifel said the leg lower was an overreaction, while Bank of America slashed its rating on the stock in the wake of the recall. Shares were more than 3% lower during premarket trading on Thursday. - CNBC's Michael Bloom contributed reporting.
A Peloton Interactive Inc. logo on a stationary bike at the company's showroom in Dedham, Massachusetts, U.S., on Wednesday, Feb. 3, 2021.
Adam Glanzman | Bloomberg | Getty Images
Peloton's skid after the company announced a treadmill product recall is a buying opportunity, Credit Suisse said.
Shares fell of more than 14% on Wednesday after the announcement.