why-is-gopro-stock-rising-1602165069447.jpg
Source: istock, GoPro

Why Is GoPro Stock Rising and Should You Buy It?

By

Updated

GoPro stock rose 29.3 percent on Oct. 7 and closed at $6.41. The stock hit its 52-week high of $6.47. So far, GoPro stock is up 47 percent in 2020. The stock has more than tripled from the 52-week low of $2 that it hit in March when the U.S. stock markets crashed. Why is GoPro stock rising and is it a good stock to buy at these levels?

Article continues below advertisement
gopro-9-1602164400280-1602164873617-1602164923344.jpg
Source: GoPro

What is GoPro?

Founded in 2002, GoPro makes action cameras. The company was founded by Nick Woodman, who is currently the CEO. GoPro sells its products across the world. So far, the company has sold over 26 million cameras in more than 100 countries. GoPro also has apps and accessories that help users capture and share their experiences.

Article continues below advertisement

GoPro's latest stock news

GoPro announced better-than-expected subscription numbers on Oct. 6 after the markets closed. “Thanks to a stellar global launch of HERO9 Black, our paid GoPro subscriber count is ahead of where we expected to be at this time and bodes well for us to exceed our previously-stated target of 600,000 to 700,000 paid subscribers by year-end,” said Woodman.

Article continues below advertisement

The company also said that most of the consumers buying HERO9 Black are also buying the annual GoPro subscription. The company offers the GoPro subscription at $49.99 annually. GoPro is also bundling the subscription with the HERO9 Black for $349.98. Woodman  said that “demand for HERO9 Black and the GoPro subscription at GoPro.com are accelerating our shift to a more direct-to-consumer business.”

Article continues below advertisement

Will there be GoPro discounts on Black Friday?

Last year, GoPro offered discounts on its products during Black Friday. The company gave a discount of up to $150 on the GoPro Hero 8 Black and a discount of up to $20 on the GoPro Hero 7 White Action Camera. The company might offer discounts on Black Friday this year.

What is GoPro's stock price today?

GoPro stock is quoted at $6.41 in pre-market on Thursday, Oct. 8. The stock had a market capitalization of $1.01 billion based on the closing price on Oct. 7. GoPro stock crossed $5 during trade on Oct. 7. Stocks below $5 are classified as penny stocks. Penny stocks are riskier  for investors compared to large-cap stocks.    

Article continues below advertisement

Is GoPro a good stock?

According to data compiled by MarketBeat, out of the five analysts tracking GoPro, two have a sell and a hold rating each, while only one analyst has a buy rating. GoPro’s target price of $4.58 represents a potential downside of 28.6 percent over the current prices. GoPro trades at an NTM EV-to-EBITDA multiple of 30.7x, which appears to be on the higher side.

Advertisement

More From Market Realist