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Here's The Research Note Boosting GoPro Stock

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Here's The Research Note Boosting GoPro Stock
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The Vetr community has upgraded $GPRO to 4.5-Stars. (Vetr)

In a report published Wednesday, Piper Jaffray analysts upgraded the rating on GoPro Inc (NASDAQ: GPRO) from Neutral to Overweight, while maintaining the price target at $55. Piper Jaffray's Teen Survey highlights robust demand for the GoPro brand.

The analysts believe that the brand is witnessing "rapid adoption" from varied audiences ranging from outdoor enthusiasts to adventure "junkies" and daily users. GoPro is benefiting from unit expansion as well as "underlying pricing gains." The brand continues to capture engaged consumers who spend more time within the GoPro ecosystem.

While leaving the estimates unchanged, the analysts mention that they could "ultimately prove conservative" in view of the consumer survey that suggests strong adoption in the US.

According to the latest survey, conducted in Spring 2015, 17.9 percent respondents indicated that their family owned a GoPro capture device. This marks a 70 bps jump from the Fall 2014 survey and is up 520 bps year-over-year. The ownership rate of 18 percent is "the highest we've seen in our survey and we view this as evidence that GoPro's U.S. growth remains robust," the analysts commented.

In the report Piper Jaffray noted, "In our Spring 2015 survey, 1.57% of respondents listed GoPro on their wish lists in the unaided question. This compares to 1.33% in Fall 2014 and was more than double the 0.64% in our Spring 2014 survey."

Teens now prefer more "visual-oriented experiences," with 32 percent of the teens surveyed indicating that Instagram was the "most important social network" - up from 30 percent last year. While the share of Twitter and Facebook continued to contract, Snapchat was at No. 4 of the most important social network list with a 13percent share, just one point short of Facebook.

"We believe it is important to view GPRO as a high-growth consumer brand and believe a 30x multiple is warranted as it is a modest premium to the peer group median of 22.3x due to GoPro's faster revenue and EPS growth," the report added.

Latest Ratings for GPRO

DateFirmActionFromTo
Mar 2017CitigroupUpgradesSellNeutral
Mar 2017Goldman SachsDowngradesNeutralSell
Mar 2017CitigroupInitiates Coverage OnSell

View More Analyst Ratings for GPRO
View the Latest Analyst Ratings

Posted-In: Piper JaffrayAnalyst Color Upgrades Analyst Ratings Best of Benzinga

 

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