Bulls and bears are singing the same old tunes about GoPro’s potential
A lockup on millions of GoPro shares expired on Feb. 18, and so far, only one insider has taken advantage of that expiration. He did so in a big way though, unloading 5 million shares of GoPro Stock.
Director sells GoPro shares
Regulatory filings with the Securities and Exchange Commission indicate that director and 10% owner Michael Marks converted nearly 15 million shares of GoPro stock from Class B to Class A shares on Feb. 17. Then the following day, he sold 5 million shares for $46.56 each, earning him a whopping $232.8 million in the sale.
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Following those transactions, Marks was left with about 9.7 million shares under his indirect ownership through his company RW Cameral Holdings LLC. He also had 889 GoPro shares left under his direct ownership.
Shares of GoPro started declining on Feb. 18, the day of the lockup expiration, after climbing as much as 12% the day before. When the lockup expired, an additional 76 million shares of the action camera maker became available for trade on the open market for the first time.
At this time, it appears as if Marks was the only GoPro insider to sell shares when the lockup expired, but it’s possible more SEC filings will come in early next week showing that others sold some stock as well.
GoPro: to buy or not to buy?
GoPro stock has been highly volatile since the company’s initial public offering. Weak guidance and the departure of the camera maker’s chief operating officer sent shares into a nosedive. Unsurprisingly, amid all the volatility, GoPro tends to be a very polarizing stock.
Tamara Walsh of The Motley Fool takes the bullish side, suggesting that the opportunities the company has outweigh its pricey valuation. Just as most other bulls do, she argues for the opportunity GoPro has as a media company through its GoPro network. Additionally, she points out that the company is still in the early stages of monetizing its content and that GoPro enjoyed blockbuster sales of its cameras during the holiday shopping period.
Bears on GoPro
On the bearish side is Margin Blanc of Bidness Etc. He thinks GoPro stock is going to keep declining because, unlike Walsh, he doesn’t see any positive catalysts in the camera maker’s future. He points out that the company is spending a lot of cash on research and development and expressed skepticism at its ability to become a media company in addition to a consumer electronics company.
Additionally, he points to the valuation, as GoPro shares trade at around a price to earnings multiple of 33 times and a blended forward price to sales multiple of 3.5 times. By comparison, Apple’s blended forward price to earnings multiple is 15 times, while its blended forward price to sales multiple is 3.3 times.
As of this writing, shares of GoPro were down by 0.75% to $44.82 per share.