Are investors overreacting to yet another technology IPO?
Newly publically traded camera company GoPro Inc. ($GPRO) is up 10% during trading on Monday as investors revealed a still-unsatisfied appetite for sustainable growth in technology hardware. Shares are up 63% since the San Mateo-based company went public and 35% from its aftermarket debut.
GoPro has managed stayed more than relevant in an otherwise dying camera industry, a multi-year market trend that can be accredited to the smartphone. The Samsung Galaxy S5 boasts a 16-megapixel camera, while the upcoming iPhone 6 is rumored to have 8-megapixels with optical image stabilization (OIS). Why carry around a digital camera and a phone when a smartphone does both?
Yet, GoPro has bucked the trend and has not only become the most exciting company in the camera industry, but is also raising eyebrows throughout the entire technology sphere.
GoPro pushes the limits that smartphones and professional cameras cannot. Designed for the outdoorsperson, adventurer, documentarian, and selfie connoisseur, its cameras are fully waterproof and durable. GoPro also offers a variety of accessories to enhance anyone's photographical needs.
For example, a whitewater rafter can strap a GoPro to his or her helmet, document the entire experience, upload the entire video to the GoPro editing app, and edit the content with music, effects, still shots, or other videos. Meanwhile, a tourist in France can attach a pole to the GoPro to take self-pictures from several feet away, capturing the entire Eiffel Tower in the background.
GoPro has become especially popular within the younger demographic. The company has also become appealing to investors, with 40% margins, 300% revenue growth since 2011, and plenty of patent protection drawing ample attention. The company is also profitable, a rarity in the age of speculative, profitless tech IPOs.
Shares tested Friday's high, topping out at $40.00 minutes after the morning bell and stabilizing around $39.50 in afternoon trading.