Do It Yourself Stock Investor

Saturday Night RORC: GoPro, Inc.

March 5, 2016

It appears that the camera giants such as Canon, Inc. (NYSE: CAJ) and Sony Corporation (NYSE: SNE) fell asleep on the action camera segment. Nikon (OTC: NINOY) is just now releasing its action camera, the KeyMission 360.

Research and Development (R&D) comes with cap levels and it's difficult to drive innovation in all directions. GoPro, Inc (NASDAQ: GPRO) has definitely taken a mile where the industry leaders gave an inch.

As a tech IPO, GoPro had captured the histeria of a classic momentum and brand power gadget. The market thought everyone would need it, buy it, buy two, etc. The stock cruized from the $20s PPS to the $80s PPS before it crashed.

In the $10 PPS range this seemed a bit oversold. The excitement had died down and parts maker, Ambarella, Inc. (NASDAQ: AMBA) had showed some declining numbers for the system-on-a-chip (SoC) designs. However, couldn't the stock rise like a phoenix once more?

GoPro chart with close March 4, 2015

The following is a look at 2015 Return on Research Capital (RORC) for GoPro, Inc:

Saturday Night RORC: GPRO

Per the RORC metric for GoPro, one R&D dollar spent in 2014 resulted in $10.67 in gross revenue for 2015. Sony outperformed and is more of a dynasty with the myriads of business outlets it has. Canon and Ambarella ranked second and fourth, respectively.


Disclosure: I am long GPRO. I have no business relationship with any company whose stock is mentioned in this article.