GoPro Inc (NASDAQ: GPRO) shares rose nearly 16 percent Thursday following the company’s comments regarding plans to cut 17 percent of its workforce. The action camera company also expects to reach the top end of its expected first quarter revenue guidance range of $190-210 million.
Despite the good news, Raymond James is maintaining its Underperform rating on GoPro.
“We still view the company as in a concerning position given the lack of evidence of revenue stability despite recent product launches, but do recognize that the company can retain a modest level of profitability at revenue levels well below current estimates,” analyst Tavis McCourt said. “Although reminding investors that this business can be managed for profitability is a positive for the stock near term.”
As shares have been exceptionally weak over the past few months, GoPro wanted to reiterate that there are no liquidity concerns regarding the business and is serious about returning to profitability. The company is currently trading at a considerable discount relative to its consumer electronic peers.
“Until investors are convinced that GoPro can return to sustainable growth and profitability, we expect the valuation to remain subdued,” the analyst said.
GoPro Spikes After Announcing Job Cuts, Expects To Be Profitable
Citi Lifts Sell Rating Off GoPro
Latest Ratings for GPRO
|Mar 2017||Goldman Sachs||Downgrades||Neutral||Sell|
|Mar 2017||Citigroup||Initiates Coverage On||Sell|
View More Analyst Ratings for GPRO
View the Latest Analyst Ratings
See more from Benzinga
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.