Stock To Watch: GoPro (GPRO) In Perilous Reversal - TheStreet

Trade-Ideas LLC identified

GoPro

(

GPRO

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified GoPro as such a stock due to the following factors:

  • GPRO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $207.3 million.
  • GPRO has traded 3.2 million shares today.
  • GPRO is down 17.4% today.
  • GPRO was up 7% yesterday.

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More details on GPRO:

GoPro, Inc. develops hardware and software solutions to alleviate consumer pain points associated with capturing, managing, sharing, and enjoying engaging content. GPRO has a PE ratio of 2. Currently there are 10 analysts that rate GoPro a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for GoPro has been 9.8 million shares per day over the past 30 days. GoPro has a market cap of $2.8 billion and is part of the consumer goods sector and consumer durables industry. The stock has a beta of 0.50 and a short float of 39.7% with 3.81 days to cover. Shares are down 55.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates GoPro as a

sell

. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • 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 64.15%, 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.
  • GOPRO INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.72 versus $0.77).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Household Durables industry. The net income increased by 276.6% when compared to the same quarter one year prior, rising from -$19.84 million to $35.03 million.
  • 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 2.06, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 47.81% is the gross profit margin for GOPRO INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.34% is above that of the industry average.

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