GoPro's woes grow as 2024 sales targets seem out of reach – analyst

Wedbush has moved to the sidelines with GoPro (NASDAQ:GPRO) as the company’s sales targets for 2024 seem unattainable.

“Given soft Q4 sales coupled with lower-than-expected Q1 guidance and 2024 subscription guidance, we no longer have confidence that GoPro can reach its prior growth targets,” Wedbush analysts Alicia Reese and Michael Pachter said in a research note.

Reese and Pachter downgraded GoPro (GPRO) to neutral from outperform and cut their price target in half to $2, a 31% discount to Wednesday’s closing price.

The downgrade added to GoPro’s (GPRO) woes. Shares were down another 12% on Thursday adding to Wednesday’s post-close loss of 6%. The company’s disappointing Q4 results compounded by below-consensus guidance left investors unimpressed with GoPro’s prospects for 2024 and beyond. With unit sales below expectations and subscription growth stalled, margins were compressed.

The company plans to expend its retail footprint this year which could cannibalize DTC sales and erode margins further without “meaningfully” expanding revenue, Wedbush says, resulting in lower 2024-2025 estimates from the firm. For 2024, Wedbush forecasts a loss of $0.10 per share versus an earlier forecast for a profit of $0.17 per share. For 2025, EPS is expected at $0.15 versus $0.57 previously.

Analysts are mixed on GoPro (GPRO) with Seeking Alpha analysts giving it a Sell rating and Wall Street analysts rating it as a Hold. Seeking Alpha’s Quant Rating views GoPro (GPRO) as a Hold. Year-to-date, shares are down 16% and down 49% year-over-year.

William Murphy

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