GoPro Inc (NASDAQ: GPRO)
GoPro has struggled in the market for quite some time now. Going back to late 2014, the stock was nearing $100 per share and trading on top of the world. However, fast forward a year or so and things changed in a big way! Today, GPRO is trading at under $13 per share and could even go further down. However, on Friday, the stock saw a glimmer of hope as it was announced that the company is getting involved in a major event, FLW. Today, we’ll talk about what the event is, how the market reacted to the news of the partnership, and whether or not I think this is going to save the struggling company that is so often called a one-trick pony!
GoPro Partners With FLW
GPRO has done a great job at creating a brand for itself. However, any solid brand needs solid marketing, and that’s an area where the company is lacking in a big way. Nonetheless, investors cheered on Friday when the company announced that it would be partnering with Fishing League Worldwide, also known as FLW. FLW is the company that runs the world’s largest bass fishing tournaments, and this year, GPRO has worked out a big-time agreement with them. Every angler in this year’s tournament will be wearing a GoPro camera. On top of that, the entire tournament will be filmed using GoPro Karma, the new drone camera offered by the company. While the Karma isn’t available quite yet, it is expected that using it to film the FLW bass fishing tournament will boost demand for the camera.
How Investors Reacted To The News
As investors, we know that the news moves the market. The reality is that any time there is good news featuring a publicly-traded company, we can expect to see gains in the value of the company’s stock as a result. Adversely, if a company is associated with bad news, we can expect to see declines in the value of the stock. The fact that GPRO has decided to listen to its investors and invest in marketing is definitely good news. So naturally, as a result of the news, the stock was climbing in a big way on Friday. During the trading session, GPRO gained $0.42 per share or 3.45% to end the day off at $12.60 per share.
Will FLW Be Enough To Save GoPro?
This is the million dollar question my friends, and while the bulls will argue that FLW will send demand for GPRO cameras skyrocketing, I have to disagree. The truth is that while GoPro is a solid brand, they don’t really offer anything that’s special. When it comes to extreme action cameras, the company was on top of the world when there was no competition. However, as any industry grows, so too does the competition. Just look at the smartphone industry and what growing competition did to BlackBerry. Here’s the bottom line… GPRO cameras are ridiculously expensive. This would be fine if they offered something special that you couldn’t get with lower cost options, but that’s not the case. The truth is that there are tons of lower cost options that are comparable in most cases and in some cases better than what GPRO has to offer! On top of that, I take issue with the Karma and the idea that drones will cause the company to climb. The truth is that professional video drones like the DJI have already cornered the market, and offering something more expensive that does the same thing will not lead to strong sales in my opinion. All in all, I believe that GPRO is likely still headed on the downward path.
What Do You Think?
Where do you think GPRO is headed and why? Let us know your opinion in the comments below!
[Image Courtesy of Wikimedia]