Analyst: No Longer Critical Of GoPro's Strategy Or Direction, Still Skeptical

Investors were not impressed with GoPro Inc (NASDAQ: GPRO) after the company reported its first-quarter results based on the stock's 7-percent decline seen Friday.

Andrew Uerkwitz of Oppenheimer maintains a Perform rating on GoPro's stock with no assigned price target following the report. The analyst noted he is no longer "critical" of GoPro's business, but is "skeptical" of the long-term opportunity.

Incrementally Positive

According to Uerkwitz, GoPro's business is now focusing more on mobile based on its three apps and a cloud service. In fact, a hardware-agnostic strategy will ultimately result in the company merging its hardware and software ecosystems together. Although this is not a "fool-proof strategy," it is nevertheless necessary.

On the hardware front, GoPro will launch a new camera called the Hero6, although details are scarce. Meanwhile, GoPro boasts an "impressive" 19-percent market share in the $1,000-plus drone category with its Karma line, which represents "solid progress" following various setbacks.

Despite an incremental positive view of the company and its direction, the analyst ultimately believes a "perfect execution" moving forward won't return the company to its glory days when it earned $1.32 per share.

Stay Sidelined, For Now

As such, the analyst is urging investors to remain on the sidelines — at least for the time being, especially since long-term investor expectations remain "unrealistically optimistic" and the company's competitors have superior expertise in design, technology and user experience.

At time of publication, shares were down 6.94 percent at $8.32.

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Image Credit: By Pete Brown from Gambrills, MD, USA - DSC00445, CC BY 2.0, via Wikimedia Commons