GoPro (GPRO) PT Slashed to $9 at Piper Jaffray on Negative Pre-Announcement
Piper Jaffray analyst Erinn Murphy reiterated an Underweight rating and lowered her estimates and price target on GoPro (NASDAQ: GPRO) to $9.00 (from $15.00) after the material revision to Q4 sales and projected margins.
Murphy commented, "Sell-through rates were challenged throughout the quarter but particularly in the earlier part. We believe trends were toughest in November. The price pressures the brand has faced of late, which have been expressed in our research in addition to the telegraphed re-pricing of the Session (twice) ,created material margin headwinds. Including the impact of the Session's re-pricing, adjusted gross margins are forecasted to come in at 34.5%-35.5% vs. the 45.5%-46.5% prior guide. We would anticipate the next few quarters to remain challenging as the company balances inventory clean up with the current run-rate of demand. We are sticking to our UW rating given the lack of near-term visibility."
The firm cut FY 2015 EPS from $1.12 to $0.84 and FY 2016 EPS from $0.97 to $0.60.
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Shares of GoPro closed at $14.61 yesterday.