Please ensure Javascript is enabled for purposes of website accessibility

Can GoPro Keep Shooting After Last Week's 12% Pop?

By Rick Munarriz - Apr 18, 2016 at 2:40PM

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

The wearable-camera maker's stock moves higher after a tempting reported hire and favorable CNBC comments following the launch of a new platform for developers.

Image source: GoPro.

Sometimes a hire can take you higher. Shareholders of GoPro (GPRO 3.11%) caught a break last week. The stock soared 12%, fueled by reports that it had poached a member of Apple's (AAPL 1.69%) legendary design team. It also won some praise on CNBC after rolling out a new set of tools for developers to create apps for GoPro devices.

Danny Coster is joining GoPro as its vice president of design. He was a member of Apple's iconic hardware design team for more than two decades. He may not have the name recognition of Jony Ive, but Coster was part of the industrial design team behind products including the iPhone 4 and the iPad's wireless keyboard. He also has hundreds of design and utility patents. 

GoPro has bigger problems than how its wearable cameras look. Sales during the holiday quarter plunged 31% since the prior year, and it's not aesthetics or fickle fashion tastes that are holding it back. There's a reason why GoPro's stock has gotten trounced since peaking shortly after its 2014 IPO, as newer products have failed to catch on the way that its earlier strap-on HERO cameras did.

CNBC's Halftime Report regular Jon Najarian then had some kind words to offer on GoPro as a turnaround play on a segment discussing GoPro's new platform for app developers, even admitting that he bought into the company earlier in the week.

"I think this stock doubles in the next three to six months," he said on CNBC.

Najarian won't be in there long enough to see that play out. His exposure last week was through the purchase of short-term options that expire next month. However, with a fellow commentator also playing up GoPro as an acquisition target during the same CNBC segment -- and Apple once again brought up as a potential buyer -- it's easy to see why speculators rallied behind shares of the former market darling. 

It's been a rough run for GoPro. The stock has surrendered a whopping 86% of its value since peaking in October 2014. There was a lot of hype in GoPro stock at the time with growth investors pondering expansion into drones and even GoPro as a media distribution hub. It's a harsher reality these days, and analysts see sharp double-digit year-over-year declines in sales through at least the first half of this year.

GoPro is trying to change its own luck, and not just because it tapped an Apple designer or is the subject of Apple takeover chatter. GoPro will be at NAB 2016 in Vegas through the next four days, showing off its new high-end products for the generation of virtual reality content. There's been plenty of wear and tear on the top dog in wearable cameras, but bullish sentiment and reasons to be optimistic are starting to pop up into the frame.

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
$6.63 (3.11%) $0.20
Apple Inc. Stock Quote
Apple Inc.
AAPL
$142.89 (1.69%) $2.37

*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 service.

Stock Advisor Returns
332%
 
S&P 500 Returns
118%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

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.