Wedbush Initiates GoPro At Outperform

On Tuesday, analysts at Wedbush Initiated coverage on shares of GoPro Inc. GPRO with an Outperform rating and $81 price target.

Michael Pachter placed a FY2015 EPS estimate of $1.15 per share plus cash which equals a multiple of 70 times earnings. Pachter finds this multiple is similar to other technology companies in the sector which trade at roughly 75 times earnings.

“We believe that GoPro deserves a high multiple due to its nascent and rapidly growing addressable market, the phenomenal benefits of its viral free marketing, its ability to reinvest in leading-edge technology and design, and its strong brand that permits premium pricing for its products.”

Moreover, Pachter stated, “According to the NPD Group’s Retail Tracking Service, GoPro was the top-selling camcorder and a top-six selling camera accessory company in the U.S. in 2013.”

GoPro is scheduled to announces third quarter earnings on October 30 after the market close.

Pachter is expecting the company to beat earnings estimates due to the popularity of the HERO3+ Black Edition, which accounted for a majority of GoPro’s revenue in Q2.