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Photograph of Marco Verch
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Sometimes business, like photography, is about being in the right place at the right time. An example: the last action in action camera manufacturer's stock
Go Pro
,
whose shares rose 11% Tuesday.
One of the reasons seems to be a press release issued on Monday, in which GoPro (symbol: GRPO) said that the cameras destined for the United States would be manufactured in Mexico from next month, while those destined for the United States would stay in China. The reaction took place even though the press release essentially reiterated a similar press release issued in December, in which it was stated that "most of the production destined for the United States was moving from China to China". Summer of 2019 ".
The Mexican part, in particular, was announced in February and the management then said that she hoped that the change would also improve the efficiency of the supply chain and generate modest savings.
"Our decision to move the bulk of our US-based production to Mexico is in line with our goal of protecting ourselves against potential tariffs, as well as cost savings and cost savings." Efficiency, "said the chief financial officer. Brian McGee said during a conference call last week.
While trade tensions between the United States and China remain high, the idea that society, its recovery still in progress, is ahead of the game offers some assurance. The stock, meanwhile, has recently been in the low of 52 weeks.
GoPro announced its first-quarter financial results last Thursday, generating 20% revenue growth and higher gross margins, although investors did not immediately announce its numbers. Wall Street continues to predict a profit for the year, which would be the company's first since 2015.
The average price set by FactSet for GoPro shares is $ 7.50, which is close to current prices. There are not many stock quotes on the stock, even though the sentiment of analysts has improved significantly since the beginning of 2018, when the company really began its recovery. ("It takes a little time to restore trust with investors," said the managing director. Nick Woodman said Tuesday at a
JP Morgan
conference.)
No one thinks GoPro is coming back to its highest post-IPO prices above $ 80. The success achieved would be similar to a strong holiday product lineup, continuous innovation, rising average selling prices and growth in high margin underwriting services, in short, evidence of continued execution. and consistent.
Send an email to David Marino-Nachison at [email protected]. Follow him to @marinonachison and follow Barron's Next to @barronsnext.
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