GoPro (GPRO) Stock Drops, Polaroid Camera Maker Sues
NEW YORK (TheStreet) -- GoPro (GPRO) - Get Report shares are tumbling 2.11% to $25.01 on Tuesday as Polaroid's parent company, C&A Marketing, is allegedly suing the company for alleged patent infringement, the Wall Street Journal reports.
On Tuesday, C&A Marketing filed a patent lawsuit against GoPro in U.S. District Court in Newark.
The lawsuit claims that GoPro's Hero4 Session camera, which is shaped like an ice cube, mimics C&A's Polaroid Cube camera design, for which the company obtained a U.S. design patent back in May.
C&A is requesting that the court stop all sales of the Session and wants an undisclosed amount of money, which includes GoPro's profits from the Session camera, the Journal noted.
Looking ahead, a federal jury may have to make a decision based on the two cameras' similarities.
Based in San Mateo, CA, GoPro develops hardware and software solutions to alleviate consumer pain points associated with capturing, managing, sharing, and enjoying engaging content.
Separately, TheStreet Ratings team rates GOPRO INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
We rate GOPRO INC (GPRO) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and weak operating cash flow.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- GPRO's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 62.27%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
- Net operating cash flow has significantly decreased to $4.62 million or 90.16% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, GOPRO INC has marginally lower results.
- 48.51% is the gross profit margin for GOPRO INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 4.69% trails the industry average.
- GPRO has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, GPRO has a quick ratio of 1.83, which demonstrates the ability of the company to cover short-term liquidity needs.
- GOPRO INC has improved earnings per share by 30.0% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.25 versus $0.77).
- You can view the full analysis from the report here: GPRO