GoPro Inc. (NASDAQ:GPRO) shares had several ups and downs this year. However, these top 5 ratings on the company were timed correctly and earned a significant profit.
1. The most profitable rating of 2015 for GoPro was made by Gus Richard of Northland Securities on March 2, 2015 when the analyst reiterated an Outperform rating for the company with a $70 price target. Richard made the rating after the company’s shares dropped due to Xiami, a Chinese smartphone company, launching the Yi Action Camera, a product similar to GoPro. Responding to investor concerns regarding the product affecting the company’s Chinese sales, the analyst believed that this launch “[validated] GoPro’s business model” and assured that “the company’s opportunity [was] significantly larger” than that of its then new competitor. The analyst stated that the company’s estimates were “conservative,” and believed that GoPro’s higher-end products outweighed the Yi Action Camera features, which were slightly better than the company’s entry level Hero product.
At the time of Richard’s rating, shares of GoPro were trading at about $40. Three months later, shares rose to $58.50. If you had purchased shares of GoPro when Richard suggested, you would have made a 46.50% return. Overall, analyst Gus Richard has a 56% success rate recommending stocks with an average return of 3.8% when measured over three months.
2. Michael Pachter of Wedbush made the second most profitable GoPro rating of 2015 on April 24, 2015, when he maintained his Outperform rating on the company with a $70 price target in anticipation of its Q1/2015 earnings. Pachter expected GoPro to post revenues in line with consensus and EPS slightly below consensus. He expressed bullish sentiment regarding demand, competition, international growth, and guidance. He stated, “Demand for GoPro products appeared brisk throughout Q1, with the sales ramp in China helping. We do not expect competition to have a material impact on GoPro sales near-term, as alternative products don’t match the value proposition of the entry-level HERO, nor the feature set of the high-end HERO4 products. More importantly, competing products don’t match GoPro’s consumer appeal.” He continued, “We expect guidance of $350 million or above, as an increasing presence internationally more than offsets any F/X drag.”
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