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Going Pro might not be that expensive?

Written by Barry Dumas | 18-Jun-2020 08:00:00

GoPro Inc (GPRO)

This niche market might have gone from “Riches to Rags” over the last couple of years but is worth the look as it might just hit one out the COVID-19 park once again.

Strong online sales have been vital for companies during the COVID-19 pandemic, and it seems the renowned action camera company is no different, gauging from its latest earnings.


Click logo to view GoPro Inc (GPRO) shares.
on EasyEquities

Fundamentals

The American Technology company’s share price is up over 128% since its March 2020 low and boasted record sales on its website over Memorial Day weekend. The first-quarter earnings came in roughly in line with analysts’ estimates. The company’s saving grace was its ability to reduce its operating cost and grow its e-commerce globally drastically.

GoPro Inc (GPRO) share overview:

  • Sector: Consumer Discretionary
  • Market Cap of $674.84 million.
  • Dividend Yield: 0 %
  • Price/Earnings (LTM): 45.7x
  • Price/Book: 3.8x
  • Next Earnings: 2nd of August 2020.
  • 52 Week Range low of $2.01 and $5.97 per share high.

The company is far from perfect and have seen a couple of rough years go by, but analysts are expecting the top and bottom to continue to grow. More importantly, expectations are that stable growth could return to our favorite action camera as soon as 2021. E-commerce is also expected to account for half its increase over the next year but might be in dire need for a new product.

Chart Life

The price action has been in a steady downtrend but seems to have bottomed out at the March low of $2.01 per share. We need confirmation that the downtrend has ended and a close above the $5.32 per share level might negate the negative outlook. If the price action moves lower from here, then the $3.35 per share support comes back into focus for another leg lower. 

Informed decisions

GoPro is an interesting one to watch and see if it can withstand the COVID-19 pandemic headwinds in the short term and if it can keep its momentum over the next couple of quarters.

The share is currently undervalued relative to the market, which might be enticing to some investors but needs profitability to return sooner than later and like any small cap, much volatility can be expected. 

Portfolio particulars

  • Portfolio Hold (Current)*
  • Portfolio Buy opportunity: close above $5.32 per share**
  • WhatsTheBeef long term target price:$7.50 per share.

Know your company: GoPro Inc (GPRO)

  • GoPro, Inc. marketed as GoPro and sometimes stylized as GoPRO is an American technology company founded in 2002 by Nick Woodman.
  • Founded as Woodman Labs, Inc, the company eventually focused on the connected sports genre, developing its line of action cameras and, later, video editing software.

Click logo to view GoPro Inc (GPRO) shares.
on EasyEquities

Source – EasyResearch, GoPro, Zacks Investment Research, The Motley Fool, Seeking Alpha, Wikipedia..

*Portfolio Hold (Current) refers to investors who already hold the stock within their portfolio.

**Portfolio Buy opportunity refers to Technical level crossed, which might imply that the markets behavior would support the outlook and Close above refers to a share price close above a Technical Resistance level.

Take note – all stock data and pricing were taken on the 17th of June 2020.

READ:
How to use EasyFX to invest in US stocks

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Barry is a market analyst with GT247, with a wealth of experience in the investment markets. Now in his tenth year in the markets, Barry "The Beef" Dumas brings a combination of technical analysis and fundamental insights to the table

 
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