This Piper Survey Suggests Declining GoPro Demand

Shares of GoPro Inc GPRO gained 20 percent this week, after the company announced the appointment of Danny Coster, a former design veteran at Apple Inc. AAPL.

Piper Jaffray’s Erinn E. Murphy maintained an Underweight rating on GoPro, with a price target of $7. The analyst considers the recent share price movement as overdone.

Growing Challenges And Waning Demand To Impact GoPro

Piper Jaffray’s semi-annual Teens Survey revealed a continued decline in camcorder ownership. Overall camcorder ownership declined to 28 percent among teens, versus 31 percent observed last Spring.

Although GoPro’s products are witnessing better household adoption, there is limited scope for upside, given the already high ownership rate, analyst Erinn Murphy noted. He added that the percentage of teens citing GoPro on their wish-lists was down to 0.9 percent, from 1.6 percent last Spring.

The year-do-date pricing and rankings for GoPro models on Amazon’s bestsellers list for electronics have stabilized, although they are below last year’s levels, Murphy pointed out.

GoPro is in the process of discontinuing several of its products and launch consumer drones in 1H and a new HERO 5 in 2H. The analyst mentioned, however, that the company may find it difficult to stimulate demand again, given the recent “air pocket of innovation.”