GoPro Inc 3Q Earnings Preview

GoPro, Inc. GRPO is scheduled to report Q3 2014 earnings after the market close on Thursday.

Ahead of earnings, the stock had fallen 25.89 percent over the past month and traded at $68.12 Thursday.

Consensus estimates for the 3Q saw EPS at $0.08 on revenue of $263.45 million and 4Q EPS at $0.53 on revenue of $499.87 million. Investors will want to see the company beat 3Q estimates but will also look carefully at 4Q and 2015 guidance.

Below is what analysts recently thought about GroPro’s third quarter along with current ratings and price targets.  Wedbush was the most bullish on the stock while both J.P. Morgan and Pacific Crest had been more skeptical.

J.P. Morgan - Neutral, $56 price target
3Q estimated EPS of $0.08 on revenues of $265 million.
We expect GPRO to meet or beat 3Q estimates, with sales buoyed by the expanding channel, deepening media ecosystem, and growing awareness, the latter boosted somewhat by the IPO branding event. With the upside risk of a positive inflection in demand
offset by the high valuation multiple, we recommend holding long positions with a long-term perspective; look for pull-backs to add to the position in this stock.

Wedbush - Outperform, $81 price target
3Q estimated EPS of $0.10 on revenue of $268 million.
We believe that GoPro deserves a high multiple due to its nascent and rapidly growing addressable market, the phenomenal benefits of its viral free marketing, its ability to reinvest in leading-edge technology and design, and its strong brand that permits premium pricing for its products.

Pacific Crest Securities - Sector Perform, no price target
3Q estimated EPS of $0.08 on revenue of $265 million.
We continue to believe it is unlikely GoPro will see the upside to hardware revenue necessary to warrant a stock price above our fair value target. Further, we would note that our fair value target [of $73] is generous for both hardware and media monetization opportunities. If guidance is anything but stellar, we believe investors could quickly assign the company significantly less credit around these future opportunities. As such, we would continue to avoid GPRO at current levels.