Skip to main content

NEW YORK (TheStreet) -- GoPro (GPRO)  shares are advancing 0.95% to $18.09 on Tuesday afternoon on anticipation that 2016 will be a great year for drones, and due to the positive app performance on Christmas Day. 

Compared to last year, drones will have 29 exhibitors at the International Consumer Electronics Show (CES), a global consumer electronics and consumer technology tradeshow that takes place every January in Las Vegas, MarketWatch reports. 

That's four times the number of vendors from last year. As expected, drones are projected to get smarter and have better tracking technologies in 2016. 

Additionally, the GoPro app ranked number 42 overall among all app downloads on U.S. iPhones on Christmas Day, moving up in the ranks compared to being number 81 last year, Barron' noted.

"The story for GoPro this holiday appears to be that less people than a year ago took advantage of promotional pricing to buy one for themselves, but more people received GoPros as gift," Dougherty & Co. stated.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

We rate GOPRO INC as a Sell with a ratings score of D. This is driven by a number of negative factors, 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 70.32%, 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 addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Household Durables industry average, but is greater than that of the S&P 500. The net income increased by 28.6% when compared to the same quarter one year prior, rising from $14.62 million to $18.80 million.
  • 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.
  • You can view the full analysis from the report here: GPRO