Could Peloton Buy Blue Apron? Here's Why Citron's Andrew Left Says Yes

Peloton Interactive Inc PTON could purchase meal kit service Blue Apron Holdings Inc APRN, Citron Research analyst Andrew Left said in a Tuesday note. 

What Happened: Left’s thesis as to why Peloton should purchase BlueApron comes from a growth perspective, he said in the report.

“Offering meal kits and integrating food in its programming to its busy and engaged subscribers is the natural progression for Peloton,” he said. 

Citron expects Peloton to buy or make a strategic investment in Blue Apron due to it being the only meal kit company with the following dynamics, Left said: 

• Strong brand
• Complete wellness offering
• Ability to scale immediately to 1 million customers
• Strong management
• Well-capitalized
• NOLs almost 2x existing market cap

With its enterprise value of $150 million, Peloton could buy Blue Apron at $20 a share and it would "not even scratch" its cash position, Left said. 

Following the 10:10 a.m. release of the report, Blue Apron spiked 3% to $7.70 and is trading 5.7% higher Tuesday afternoon at $7.79. 

APRN, PTON Price Action: Switching gears to Peloton, the stock popped 9% to $36.85 following the Citron report's publication and was up 25.21% at $37.25 in afternoon trading. 

Photo courtesy of Blue Apron.