Shares of camera maker, GoPro Inc. ended in the red zone on Monday session as it fell sharply to its all-time record low after the investment banking firm, Goldman Sachs Inc, downgraded its hares for the second time on concerns over the company’s struggle to compete in a tighter market.
Blurred Lines
GoPro shares gave up as much as 10% to close at $7.95, its lowest intraday price in two years, when the firm introduced its shares in the stock market at $24 last June 2014 after banking firm Goldman gave the camera maker a second major downgrade from neutral to sell.
According to Simona Jankowski, an analyst at the bank, they expect GoPro to continue to struggle fundamentally. In a note to their clients she cited that “GoPro’s main challenge is that its core action market is largely saturated, as it has not attracted a significantly broader and more mainstream audience."
The challenge rooted mainly from its disappointing entry in the drone market and the controversies plagued to its product launch in the holiday season.
Goldman Sachs lowered the stock price target for GoPro share from $9.50 to a low of $6.
Citigroup Global Markets Inc. was the first to downgrade the shares of GoPro when it initiated the coverage of the stock with sell recommendation at $8price target, with Citi analyst Stanley Kovler describing the firm as the “best house in a deteriorating neighborhood.”