Oct 17, 2016 12:55 AM EDT
GoPro's Shipping To Amazon Temporary Stopped; Shipping Will Be Back on October [VIDEO]
Analyst Erinn Murphy believes that the GoPro's outlook for the second half of the year doesn't include the disintegration to Amazon sales, but she is 'incrementally concerned' about the ability of GoPro to hit its guidance numbers.
Murphy said "Nonetheless, this is a disruption of a key partner that we believe was not contemplated in guidance and we will continue to monitor the progress of this channel partner into the Holiday season."
Only 12 percent to 14 percent of GoPro sales was represented by the Amazon, as the action camera maker has been shipping as usual to Best Buy, its own GoPro.com channel and other partners at the same time.
Piper Jaffray reiterated its underweight rating on the stock with a target price of $9, and this dropping of stock price is just a reaction an event.
Down, but certainly not out
A month ago, GoPro Inc. launched its Karma drone and Hero session 5 camera - its first major launch in more than a year. The stock gained 20 percent after the launch, but when the hype faded, the stock dropped more than 15 percent in a week.
According to Amigobulls, there are two reasons for the crash. First, the stock jumped much higher than the company's fundamentals warranted after the launch. Second, the launch of Mavic Drone by DJI impacted it.
The Mavic is better than GoPro's Karma on many counts, as it is lighter, smaller, and can fly faster, higher, and longer. Much importantly, GoPro's Karma lacks two vital features that Mavic has: "obstacle avoidance system" and "follow me," the same publication has learned.
The stock is now back to reasonable levels, but it could gain again on the back of good third-quarter numbers, including sales of the Karma and Hero Session 5, according to GoPro Inc.
Meanwhile, the Karma drone enjoys several advantages over the others, despite competition from several players. The Hero Session 5, on the other hand, is likely to push sales up. It will reap the benefit of the holiday season too.
GoPro shares were down 0.84 percent at $14.18 at 10:08 a.m. Eastern.
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