GoPro Inc (NASDAQ:GPRO) made a scintillating debut in share market in June 26, 2014 with IPO price of $24 per share. In less than four days of trading the share values doubled. As the Camera Giants options became valid for trading, the stock price started dropping. Stock price went into thirties for the past few days but again is up into the forties. Alex Guana, JMP Securities Senior Analyst, talked on CNBC about the camera maker’s success and growth that he is foreseeing for the company.
JMP securities was one of the first companies to initiate coverage on GoPro Inc (NASDAQ:GPRO) and Guana was the analyst who made the call on that decision. He thinks that GoPro is a durable organization. He feels that competition is always a risk factor and JMP securities are committed to watch that for their investors.
“Most importantly, right now Momentum is at the back of GoPro. They have proven that they have very clear vision in terms of defining a new category of active lifestyle capture. They are articulating a very interesting and visionary picture of what they can do with their media assets that have achieved the number one ranking on Youtube branded channels right now,” Guada said.
He thinks that their management team has great track record of success now. He feels that, number two company in camcorder market in US, Sony Corp (NYSE:SNE) and close competitor to GoPro is currently having a damaged brand. So he said that GoPro Inc (NASDAQ:GPRO) has a number of good years ahead.
Guana wrote in his thesis that GoPro has multitude of unpenetrated opportunities which they can capitalize on to monetize the technology and brand. He pointed to their media strategy as the key. He feels that hiring Tony Bates, Former President of Skype and bringing a proven asset into the mix is huge for the company.
He thinks that GoPro can tap into the $1 billion media market opportunity this year, through GoPro Channel with Youtube and in proprietary fashion with Xbox and various other unarticulated opportunities. Without including this $1 billion JMP has estimated a $50 billion internet advertising opportunity to GoPro Inc (NASDAQ:GPRO) this year.
He feels that GoPro can recreate the 45% share in global sense as well. This would lead to a an over 20% growth for next several years. He feels that GoPro has displayed that it has vision. One concern for this company might be competition from bigger companies with better fundings.
“What GoPro has achieved is coming into market where all those obstacles already existed: the bigger companies, the better funding and it’s taken them down,” Guana added.
He thinks that GoPro Inc (NASDAQ:GPRO) can continue to innovate around a very powerful brand and develop a media strategy to complement a strong hardware strategy and none of the competition current moves have potential to stop this momentum that GoPro has got with them.