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GoPro's New Products In Focus

KeyBanc analysts have raised estimates for GoPro Inc GPRO 0.61% on the upcoming launch of Hero 5 'basic.'

The brokerage has increased his third quarter/fourth quarter/full-year EPS estimates to $(0.23)/ $0.52/ $(0.86) from $(0.25)/ $0.43/ $(0.97). Consensus estimate calls for EPS of $(0.37)/ $0.45/ $(1.07).

"Based on our checks, we expect three new camera SKUs to be released with a Hero 5 "basic" version featuring 1080p video, while we think the presumptive Black and Silver will feature 4K 60 frames-per-second and 30frames-per-second, respectively. Thus, we think this should drive a bit better elasticity than our previous expectations," analyst Brad Erickson wrote in a note.

Previously, the analyst had anticipated only two new camera SKUs (a presumptive Black and Silver).

However, the analyst said his checks show a relative lack of interest for GoPro's Karma. Erickson's new unit estimates imply 31 percent decline in 2016 and 0.8 percent decline in 2017.

Erickson has a Sector Weight rating on GoPro shares and is waiting to see the customer response to new cameras and drone before becoming more constructive on the name.

"The company's message of the most connected and convenient GoPro ever is intriguing, but if new hardware and software features fail to attract incremental buyers to the category, we'd have concerns that expectations, particularly for the out year, could be too high," Erickson noted.

DateFirmActionFromTo
Jun 2016Longbow ResearchInitiates Coverage onNeutral
Feb 2016Morgan StanleyMaintainsUnderweight
Feb 2016Sterne Agee CRTDowngradesBuyNeutral

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