[GregWeld]

#1 -- I do not own GoPro (GPRO) nor do I expect to... and once again - I'm not trying to discuss buying or selling this particular name. However... since it's the recent IPO and Market Darling.... I'm always interested and I pretty much spend my day either messing with cars - or reading and scanning news which relates to stocks....


So we always are discussing FUNDAMENTAL CHANGES -- what to look for - and to look out for. They're important. Not all news is FUNDAMENTAL... but we're always wanting to scan for things where it can be. Here - for INVESTING 102... is an example I just found by accident on GoPro.

REVENUES are what drive share prices. End of story. Big profits. Big revenue. Big expectations.

BEWARE big expectations - because then we have to think about the "priced for perfection" scenario where the stock gets crushed even if they did pretty well - but they didn't meet "expectations". We've discussed this earlier. I tread lightly when expectations get overblown.

BUT the 'news' here, is news to me -- because we discussed the fact that many think GoPro is a one trick pony - with basically a camera and attachments to sell ------ yet here's an article bringing up the possibility of a huge advertising revenue stream... that's pretty fundamental and can be a real runner if it proves to be A) True and B) bigger #'s than expected (ah beware!).

Again -- nothing about GoPro -- But about the little nuggets and changes that can make or break any investment -- That's what I want readers/investors to start thinking about. Don't just look at the share price gain today or tomorrow... look for nuggets, good or bad. Learning these things is what we're all about.




Long-term investors in GoPro can probably ignore today's drop. While it's important to be aware of the short interest in the stocks you hold, heavily shorted stocks can also quickly spike on good news due to short squeezes from short sellers attempting to cover their bets. Even after the pop, shares still seem reasonably priced at a P/S of 6, and the company, which is only 10 years old, is already profitable. GoPro dominates the niche market of stunt and extreme sports-based video, and is set to begin collecting money from advertisers, which should give the company another valuable revenue stream. As video usage and wearable technology continues to grow in the Facebook/YouTube generation, I'd expect GoPro to thrive