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How Did GoPro Perform in 2Q16?

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Price movement

GoPro (GPRO) rose by 14.1% to close at $12.64 per share during the fourth week of July 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were 14.1%, 16.9%, and -29.8%, respectively, as of July 29. GPRO is trading 10.0% above its 20-day moving average, 17.3% above its 50-day moving average, and 13.9% below its 200-day moving average.

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Related ETF and peers

The iShares Morningstar Small Value ETF (JKL) invests 0.20% of its holdings in GoPro. The ETF tracks a market-cap-weighted index of US small-cap value stocks. The index stocks from the 90th to the 97th percentile of the market cap spectrum, using fundamental factors. The YTD price movement of JKL was 12.2% on July 29.

The market caps of GoPro’s competitors are as follows:

  • Canon-ADR (CAJ) — $36.7 billion
  • Sony (SNE) — $38.2 billion
  • Best Buy (BBY) — $10.8 billion

Performance of GoPro in 2Q16

GoPro reported 2Q16 revenue of $220.8 million, a fall of 47.4% from the revenue of $419.9 million in 2Q15. The company’s gross profit margin fell by 9.0%.

Its net income and EPS (earnings per share) fell to -$91.8 million and -$0.66, respectively, in 2Q16, compared with $35.0 million and $0.24, respectively, in 2Q15. It reported adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) and adjusted EPS (earnings per share) of -$76.8 million and -$0.52, respectively, in 2Q16, compared with $75.3 million and $0.35 in 2Q15.

GPRO’s cash and cash equivalents and inventory fell by 41.5% and 52.2%, respectively, between 4Q15 and 2Q16. Its current ratio fell to 2.1x and its debt-to-equity ratio rose to 0.45x in 2Q16, compared with 2.8x and 0.43x, respectively, in 4Q15. The company expects revenue in the range of $1.35 billion to $1.5 billion for fiscal 2016.

In the next and final part of this series, we’ll discuss LKQ Corporation.

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