Wednesday, November 18, 2015
For long-term fundamental investors the path to superior returns is via market sentiment - both when it is high and it is low. Gpro has been a constant topic in this blog due to the fact that I long argued that it was vastly overvalued due to market sentiment. Well things go both ways. Now, at about $19 dollars per share, I actually think that Gpro is undervalued. The sentiment has turned so dramatically that its P/E ratio is below the average for the S&P 500. While it may not have the growth options implied by a $90 dollar price, it does have some. Ironically, my models suggest a fair value around the IPO price of $24. Stay tuned as the saga continues.