GoPro Inc (NASDAQ: GPRO)
GoPro is a company that has been struggling for quite some time, and for good reason. The company simply can’t seem to sell its top of the line cameras. However, the bulls on the stock believe that this will be the year it will soar. Today, we’ll talk about why investors believe that this will be the year for GoPro, why I believe they are sorely mistaken, and what we can expect to see from GPRO moving forward. So, let’s get right to it…
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Why Some Investors Believe GPRO Will Climb This Year
The idea that GPRO is going to have a great year is fueled by product releases. Throughout the year, it is expected that we will see the Hero 5 camera and a drone released by the company. The Hero 5 is actually designed to fit into what is known as the Karma drone. The reality is that drones are the hottest new thing. I have to admit, I have a collection of 4 drones myself, each for different things. So, I can see why some investors believe that this year’s releases will save GPRO. However, as mentioned above, I believe that those investors are sorely mistaken. Here’s why…
Touching On The Drone Side Of Things
First off, let’s start by talking about drones. Let’s face it, drones are awesome! With drones, we can take pictures and videos that we never had the opportunity to take in the past. So, it’s no surprise that the drone market is growing at an exponential rate. However, I don’t believe that this will save GPRO. The reality is that there are already tons of drones on the market, many of which are designed to take high quality photos and videos. For example, I have the DJI Phantom 3. In fact, I have to say that of all of the drones in my collection, this one is by far my favorite. The reason its my favorite is simple, it takes stunning 4K video – I’m talking the professional stuff here! Also important to mention, the DJI Phantom 3 sells on Amazon for $1,000.
So, what does this have to do with GoPro? Well, it has everything to do with the company! That’s because GPRO cameras come with a relatively hefty price tag. Sure, they may shoot video comparable to what I shoot with the DJI Phantom, but when you compare the cost of buying the GoPro Hero 5 along with a drone to the cost of buying a professional video drone like the DJI, GPRO simply doesn’t have a leg to stand on. For the same quality, you will have to pay hundreds more than you would have to pay to get a great video drone with a camera already attached!
Here’s The Real Problem With GPRO
The big problem with GPRO is relatively simple to understand. The reality is that when the company first started offering its cameras, it was on top of its game with regard to innovation. However, since then, the company seems to have kicked innovation to the side and started to focus on jumping on the band wagon! The reality is that today’s GPRO cameras are comparable to several other cameras on the market. But, they all come with a hefty price tag and none of them seem to offer anything special! Is there something special about flying a drone around and taking video? Absolutely! Is there something special about spending hundreds of dollars more to fly a GPRO camera around and take video? Absolutely not! The problem here is that GoPro has a fundamental lack of innovation.
Where GPRO Is Headed From Here
Moving forward, I have a tremendously bearish opinion of what we can expect to see from GPRO. While the stock may get a little boost upward when the new products are released, we will quickly see declines following sales reports. All in all, GPRO has very little to offer when compared to other companies in its industry. Naturally, this is a recipe for failure!
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What Do You Think?
Where do you think GPRO is headed moving forward? Let us know your opinion in the comments below!
[Image Courtesy of Wikipedia]