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GPRO has had quite a party, running from its initial IPO opening price of about 28 all the way to about 98 and now back to about 47.
The problem with this stock is that it has a fairly high P/E (51.22 which is at least one third of what it was before) and may be overvalued.
On the most recent earnings day this stock blew out earnings - beat the street by 0.29 on EPS and revenues by about fifty million. GPRO crushed the estimates! As soon as the estimates were released on February 5, 2015, after the bell GPRO rocketed from its close of about 54 to above 60.
But still, just because the resignation of the CFO was announced minutes later, which is typically an indication that fraud was going on in the company and its officer stepped away to distance herself from the fraud, and also because GPRO warned about impending weakness in Quarter 1, the stock plummeted, all the way down to 46!
Compare with GOOGL:
GOOGL - Google stock - a great trading stock - Free EBAY, PayPal, Business and Law Forums - Ebay Suspension, PayPal Limited
that MISSES estimates but goes up anyway.
The point being that - on a fundamentally sound stock like GOOGL, people look for an excuse to buy. On something weaker, like GPRO, people are spooked more easily - sometimes practically look for an excuse to sell.
The moral here is: trade stocks that you wouldn't mind OWNING. If you do trade weaker or newer stocks like GPRO, know that the risk is higher, although yes - the reward may also be higher.
The problem with this stock is that it has a fairly high P/E (51.22 which is at least one third of what it was before) and may be overvalued.
On the most recent earnings day this stock blew out earnings - beat the street by 0.29 on EPS and revenues by about fifty million. GPRO crushed the estimates! As soon as the estimates were released on February 5, 2015, after the bell GPRO rocketed from its close of about 54 to above 60.
But still, just because the resignation of the CFO was announced minutes later, which is typically an indication that fraud was going on in the company and its officer stepped away to distance herself from the fraud, and also because GPRO warned about impending weakness in Quarter 1, the stock plummeted, all the way down to 46!
Compare with GOOGL:
GOOGL - Google stock - a great trading stock - Free EBAY, PayPal, Business and Law Forums - Ebay Suspension, PayPal Limited
that MISSES estimates but goes up anyway.
The point being that - on a fundamentally sound stock like GOOGL, people look for an excuse to buy. On something weaker, like GPRO, people are spooked more easily - sometimes practically look for an excuse to sell.
The moral here is: trade stocks that you wouldn't mind OWNING. If you do trade weaker or newer stocks like GPRO, know that the risk is higher, although yes - the reward may also be higher.
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