Trading at less than 1.2 times sales over the last 12 months, GoPro has the potential to post a substantial recovery on even tentative signs of improving business. The stock has been historically volatile, and a beaten-down valuation creates the potential for big upswings in the event of stronger-than-expected earnings performance, news of a potential buyout, or the unveiling of promising new products or partnerships. That doesn't mean the company will end up a long-term winner, however.
With the threat of bigger tech competitors cutting into action camera sales and the company's admission that it won't be able to build the media network that was once touted as a core component of its future, the long-term outlook for GoPro is filled with challenges that make it an inadvisable long-term investment option for those without high tolerance for risk.
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Keith Noonan has no position in any stocks mentioned. The Motley Fool owns shares of and recommends GoPro. The Motley Fool has the following options: short January 2019 $12 calls on GoPro and long January 2019 $12 puts on GoPro. The Motley Fool has a disclosure policy .