Is GoPro Inc (NASDAQ:GPRO)’s Turnaround Strategy Finally Paying Off?



GoPro Inc (NASDAQ:GPRO) was up by 1.73% in Monday’s trading session after Morgan Stanley analyst, Yuuji Anderson, upgraded the stock to an Equal Weight. The upgrade came on growing confidence that cost cuts and new video editing functions are paying off. The analyst also expects new software to help trigger an upgrade cycle of the company’s old devices.

One month daily candlebar chart for $GRPO

Stock Performance

Shares of GoPro Inc (NASDAQ:GPRO) have stabilized this year amidst talk that the company is a turnaround play. The stock continues to trade between $7.50 and $9 a share after plummeting from record highs of $90 a share as of 2014. Cost cuts have come into play ever since the company lost $200 million last year. The camera maker has also raised cash through convertible debt in a bid to stay afloat.

Optimism that GoPro Inc (NASDAQ:GPRO) continues to soar on the belief that the forthcoming Fusion 360-degree camera will be a success. The company has already shipped some units of the camera as part of a pilot program. The response so far has been positive. While the camera is not expected to be enough to save the stock on its own, an intriguing go-to-market strategy could help revitalize the company’s prospects.

GoPro Turnaround Strategy

GoPro Inc (NASDAQ:GPRO) has already received 20,000 applications from content creators. The company is banking that such content will help consumers better understand the capabilities of the Fusion camera.

The company is also paying close watch to software updates as it seeks to differentiate its software platform versus their competitors. The launch of the QuickStories feature is designed to make it easy for users to get edited footage off their cameras. The software, coupled with smartphone connectivity, is a key pillar of GoPro Inc (NASDAQ:GPRO) strategy going forward.

“[…] What happens when that business fixes that problem and now has a solution that’s very easy for the consumer to be successful with? We believe that can have a dramatic impact on our company because it’s going to have a dramatic impact on consumers,” said Nick Woodman, GoPro CEO.

Helped by the launch of the Hero5 camera. sales of the company’s products in the first quarter rose 19%. Narrowing of the product line to just four consumer devices has helped the company simplify its marketing strategy and drive efficiencies.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

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