Please ensure Javascript is enabled for purposes of website accessibility

Why GoPro, Inc. Stock Popped 19.5% in September

By Steve Symington - Oct 3, 2017 at 5:28PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Before launching its latest flagship camera last month, GoPro told investors to expect strong Q3 results. Here's what investors need to know.

What happened

Shares of GoPro Inc. (GPRO -3.61%) jumped 19.5% in September, according to data from S&P Global Market Intelligence, after the action-camera and drone specialist offered strong preliminary results and introduced several new products.

To start, GoPro stock rose than 12% on Sept. 7 alone, which was the first trading day after the company announced that third-quarter 2017 revenue and gross margin would both arrive near the high ends of its previous guidance ranges. That guidance initially called for Q3 revenue of $290 million to $310 million, and gross margin of 36% to 38%.

GoPro Chief Operating Officer CJ Prober stated at the time that the company was enjoying strong demand for its products, adding that channel inventories had been reduced ahead of the impending launches of GoPro's new HERO6 and Fusion cameras.

Man holding a GoPro HERO6 Black camera overlooking a waterfall

GoPro launched its new HERO6 Black camera in September, IMAGE SOURCE: GOPRO

So what

GoPro stock also skyrocketed in August, when that initial guidance was given -- though it also helped that the company crushed Q2 expectations and confirmed that the aforementioned new products were on track to be launched by the end of the year.

Sure enough, GoPro not only introduced both the significantly improved HERO6 and Fusion during an event on Sept. 28, but it also added several key features to its Karma drone -- including "Follow-Me" functionality -- through a firmware update.

Now what

The $499.99 HERO6 Black was made immediately available at both GoPro.com and select retailers, while the $699.99 Fusion remains on pre-order and is expected to ship in November. Most importantly, both should be available in time for the crucial 2017 holiday season, which could serve to further accelerate GoPro's return to sustained profitability. If GoPro can sustain its recent momentum with equally strong demand for its newest products, I think the stock should only continue to respond in kind.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

GoPro, Inc. Stock Quote
GoPro, Inc.
GPRO
$5.60 (-3.61%) $0.21

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
319%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.