Citigroup Reacts to GoPro CFO Clarifying his CES Comments

In a report published Tuesday, Citigroup analyst Jeremy David reiterated a Neutral rating and $94.00 price target on

. In the report, Citigroup noted, “After our CES meeting with GoPro CFO Jack Lazar last week, we wrote that Lazar had stated margins on the $130 HERO device were ‘significantly below' corporate average. While we continue to believe this is the case – see below for our analysis – we are amending the statement to read that Lazar only confirmed that the HERO is a lower price point, lower cost capture device. Nonetheless, our BOM analysis implies that the BOM on the $130 device is likely no less than ~$90, implying a gross margin of 23% assuming an ASP to GoPro of ~$117 (i.e., a 10% retail margin), about 20 points below the corporate average.” GoPro closed on Monday at $56.78.