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Pacific Crest Securities issued a company spotlight on
GoPro IncGPRO as the company's quarter ending checks met expectations. Pacific Crest rates GoPro as a Sector Perform, while a price target was unavailable.
Analysts Brad Erickson and Andy Hargreaves wrote, "we found fewer mid-tier and low-end GoPro models in the channel versus last month, which could benefit ASPs and margins. We were encouraged to find evidence that retailer gift card bundling for Hero 3+ Silver products continued despite low inventory...video-editing software development is the key to unlocking an accelerating TAM expansion thesis for the longer term as the action camera space will likely become more competitive over time."
Pacific Crest believes that a video editing software breakthrough is needed for continued accelerated growth for GoPro. While GoPro has a dominant market position and stable, expanding margins, any signs of improvement in the competition's products could drive further multiple compression for the company. Investors will be looking for GoPro to issue a clear picture of media monetization going forward which could be a positive catalyst for the stock.
Shares of GoPro closed Thursday at 41.96.
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Posted In: Analyst ColorLong IdeasAnalyst RatingsTechTrading IdeasAndy HargreavesBrad EricksonPacific Crest
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