GPRO stock has been gaining momentum over the past week, with a gain of about 30% and up 50% over the course of September. The stock gained even though there was no specific news from GoPro (NASDAQ:GPRO).
Expected Product Launch
Any news related to the trade tariff war, you would think, would influence GPRO stock negatively. Last month, however, the company informed investors that Chinese tariffs would not affect its Q2 2019 performance. This is because GoPro moved most of its US-bound camera production into Mexico back in June.
However, there is also another potential factor that might have resulted in an upward push. GoPro released its famous HERO7 camera line at the end of September last year and might want to keep up with that schedule this year. Therefore, there are expectations that the company will launch its latest camera models in the coming week. If GoPro launches the new camera line next week, it will be on the path to a very fruitful second half.
At the time of writing, GPRO stock is up 11.50% at $5.78.
Strong Second-Quarter Performance
GoPro CEO, Nick Woodman, promised recently that the company expects to have a robust second half, which will be a result of the strength of new products expected later this year. The new launches will spur GPRO stock forwards, and the company will still have a lot for it to return to sustainable, profitable growth. Besides the product launches, the company has also enjoyed enhanced growth from the improvement of its Plus service subscription service.
The company grew revenue in the second quarter and achieved profitability, stated the CEO. The company reviewed its outlook for 2019, and now it expects revenue to grow by 9% to 12%, which will translate to earnings of around $0.40 per share.
Investors should, therefore, focus on the strength of the company’s underlying businesses as it continues to implement its turnaround strategy. However, it is also normal to see GoPro rally as traders anticipate the new product line-up even as the wider market continues to experience a down day.
Despite the recent rise, GPRO stock is still down 25% from 2019’s high.
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