Wedbush downgrades GoPro, halves target on lack of confidence

Wedbush downgraded GoPro to Neutral from Outperform with a price target of $2, down from $4. The company’s prior sales growth targets appear unlikely in 2024 and possibly beyond, while its margin expansion opportunities are limited, the analyst tells investors in a research note. The firm says that given “soft” Q4 sales both domestically and in Asia-Pacific, coupled with lower than expected Q1 guidance and 2024 subscription guidance, it no longer has confidence that GoPro can reach its prior growth targets. As a worst-case scenario, expanding retail doors could further cannibalize direct sales, eroding margins further without meaningfully expanding revenue, contends Wedbush.