GoPro has poor financials (negative equity, high burn rate) and is near bankruptcy; not a viable standalone investment without acquisition hopes.

What if I told you that if you had invested $1000 in GoPro at its peak, it would now be worth only $17.64? Yes, that means a loss of more than 97 percent.

But what if I told you that if you had invested $9 million just two months ago, you could have turned it into $15 million because the company has now announced its acquisition, and you just happened to have avoided this collapse, and fallen completely in love with the stock before you managed to time your $9 million investment in a company that was collapsing to turn it into about $15 million?

So, is GoPro another GameStop? Okay, let's look at the financial data and see if there is value within that data, and if there is a company that is really worth buying, perhaps because the market is mispricing it .

Because this was ultimately the "Roaring Kitty" argument. Hey, you know, I love the arrow. The numbers look good. It is being sold at an inverted valuation . Why shouldn't I buy this stock?

It seems I'm making a good investment. Can you say that about "GoPro"?

If we look at GoPro's latest financial data, we will discover the following. First and foremost, their revenues have decreased by approximately 31% year-on-year. Their costs decreased by only about 25%, which means that their costs actually grew compared to their revenues, right?

Thus, their profits diminished even further. What you want is that if your revenue falls by 31%, your costs should hopefully fall by at least 31%, but that hasn't happened. The company operates very poorly.

Thus, their profits actually decreased by 42%, and their losses increased year-on-year by 2.7 times. So, the company is clearly in decline.

The problem is not just that the company is declining, but its founder literally had to provide a $20 million bailout loan to keep it alive. That's not good at all. Actually, we have a small note about that specifically here.

Here's the note. The founder ended up lending GoPro $20 million on July 8 because they were severely short of cash. The CEO also received internal options that effectively gave him greater gains in the event of the company's acquisition, which is what actually happened, as we heard on September 1st.

Therefore, the CEO will now recover his $20 million loan plus approximately $9 million from those options. To be fair, this was disclosed, so everyone was aware of this loan.

Mark says, "This seemed like a cheap company." And he liked the company's evaluation. When we look at their balance sheet , that's where I get a bit confused. Because the company has about $97 million in cash and incoming revenue.

They also have about $86 million more in inventory, but that assumes it can be sold at the value listed here. concept? So, if we scroll down a little, we can see their bills, or what are known as current liabilities, due within the next twelve months .

They have invoices totaling $353 million. This means, if you follow the numbers, that they are suffering from a deficit of approximately $200 million. In fact, more than $200 million.

Approximately $270 million in deficit. Closer to 200 million if we assume they can sell their entire stock. Even if we assume they can sell the entire stock, that's fine. It still suffers from a deficit of $200 million.

With the company's losses just increased 2.7 times, and you're burning through $51 million every quarter based on the last quarter's report, with a deficit of $200 million, your liquidity situation is getting worse day by day.

This is a clinically dead company that cannot afford to pay its bills.

Just to put this in a different perspective. GoPro was losing $560,000 a day. This means that Mark's $9 million investment will evaporate within 16 days of losses. Because their revenues were fluctuating.

They lost about 81 million in the first quarter here. They lost 9 million during the Christmas season. They lost 51 million in the report that was just released or the quarter that was just announced.

And they continue to burn through liquidity, aren't they? They don't have a really good balance sheet. This is a company you look at and say is on the verge of bankruptcy. This doesn't look good.

There is nothing substantial to admire here unless you believe a potential takeover is about to occur.

Let's put another perspective on this. Let's look at their balance sheet a little differently, okay? So, let's put the numbers side by side. If you generously add the cash they have, let's assume everyone will pay GoPro the money it's owed .

Those are the debts owed . And if they sell their entire stock. In this case, they have total assets worth $174 million . But they have outstanding bills to pay, and other bills on their desks, these are incoming bills and others that have accumulated, and various debts, isn't that right ?

They must repay all these obligations within the next 12 months . The total is $405 million. If you subtract these two figures, you will see a gap of over $200 million, or a deficit of $230 million.

Now, on paper, if you add fame, they are still in a deficit. And if you calculate the tangible book value, they are also in a deficit. So, no matter how you look at it, whether you use long-term assets included in tangible book value , or list their virtually worthless reputation on paper.

However you analyze this company, you will find that it is in a state of deficit. The book value is negative, okay? This is not an investment you would put $9 million into unless you believe for some reason that this company is about to take off.

In my opinion, I want to be clear, okay? This is just my opinion as a financial analyst looking from the outside; it seems strange. Furthermore , the company has already revealed some things.

They had already revealed in March that they had breached their loan commitments. In other words, they were actually struggling to repay the debts they had. This was a company headed for bankruptcy.

They also announced in May that they had substantial doubts about their ability to continue or survive the next 12 months. This is called "business continuity ". This term is common for new startups, but it is unusual for a company that has been established and listed on the stock exchange for 11 or 12 years unless it is on the verge of bankruptcy, right?

They pay the bank $250,000 a week. They are trying, or that this amount actually rises to a million dollars as more of these loans become due. They have already revealed that they need to refinance or get everything done by January 2027, otherwise they will face a problem and will have to pay $5 million in fees if they go bankrupt.

So, the banks had to tell everyone, "You need to sort this out because you're a sinking ship and we're about to essentially seize your assets." That is, we will demand that you repay your loan in full immediately . This is not a good thing.

Now, to be fair, on May 11, the company revealed that it was open to a sale or merger, but that's a very common disclosure when you 're on the verge of bankruptcy because you're trying to launch a rescue balloon.

It's like being stranded in the ocean and sending out an orange distress signal into the sky. It's kind of like saying, "Please." Please. Let someone come and buy our company. So, you can see that in their latest report, you can see it right here.

In May, they announced the start of a process to assess the likelihood of a sale or strategic alternatives. But, while you are on the verge of bankruptcy, who would want to buy you?

That is the question here. The fact that they disclosed "Hello, please buy our company". You know, someone else has to take the risk and cover some of these losses. Therefore, it is strange to expect someone to buy a ship that is burning and on fire.

It is also strange to put what some rumors suggest amounts to as much as 30% of your net worth, Mark. Some say they don't know what his net worth is. All they know is that he invested $9 million just before this acquisition was announced.

Here are a few other things to note regarding timing, okay? On July 13, Mark exceeded 5% ownership of this company. It took him about 6 to 7 weeks to submit the disclosure that was supposed to be submitted within five working days or seven calendar days.

Then on August 27, he made a promotional video for "GoPro" and did not mention that he owns shares in the company. He only mentioned that it was a sponsored video. On August 30, a Bloomberg report about his ownership appeared.

Two days later, a merger was announced at a price of $ 1.14 per share, a share that, if you look at it here, has clearly collapsed. But if we look closely at the last hour, you can see the Bloomberg story that was published about Mark's ownership, where the stock rose from about 70 cents, which is roughly the price at which Mark bought it , to jumping every day up to about a dollar or a dollar and 70 cents .

So, if you bought the stock for 70 cents and its price is now $1.70, you have made a profit that is 2.4 times your investment , which is really impressive.

Now, regarding the acquisition, will Mark sell his shares? It doesn't seem that way . We don't know. If he only receives $1.14 of the announced acquisition price , he will still have made a profit of more than 60 percent.

This is still impressive. But this timing is a bit strange . Let's be very clear about how this timing works , and we understand that he's not a finance expert, you know, Mark, so he probably didn't know.

But , to clarify further, okay? You owned more than 5% by July 13th, and that's literally according to your own files , okay? You are required to submit a file within five working days of exceeding the 5% threshold, which should have been on July 20th.

But you did not submit the file until August 20, which happened to be about 12 days before the merger was announced. Of course, the Securities and Exchange Commission is content with issuing a simple warning for late filings, but it's a bit strange .

So, what this suddenly means is that you converted a $9 million investment at an average acquisition cost of perhaps around 69 cents into a cash price in the deal of $1.14. This means that a company that was losing $9 million every 16 days, you bet $9 million on it and now owns a stake worth $15 million according to the deal price.

However, the stock is currently trading at a price even higher than that deal price. So, you are in a better position. It's very interesting.

So, how can all of this be reconciled? How do we put all these pieces together? Because the other suspicious thing is that Mark updated the description of the videos he made to indicate that he is now an owner of the stock.

Look, take a look at this. I used the Wayback Machine, inserted a YouTube link, and got an archived copy dated August 27. This is the description here. Pre-order "Mission 1 ILS" and use the code Markiplier.

Good. So, you and I both know that this is a promotional (commissioned ) link. But note that it is not mentioned anywhere, at least in the description, that this is a sponsored advertisement.

There is no note indicating that this is an advertisement. There is no note indicating that this is a company he owns or has an interest in. It is not clear whether this necessarily needs to be disclosed.

It could simply be a normal investment. He is not obligated to tell everyone about his investment portfolio. Ah, but, you know, whatever it is. Ignore this. I mean, I think most people know that affiliate links are paid advertisements.

But Kim Kardashian came under heavy fire for doing exactly that. I mean, I've been attacked in many ways. But, um, she, as you know, put a follower link on her Instagram. She was then fined heavily for failing to disclose that it was a paid advertisement.

Now , to be fair, in Mark's video, which is 13:37 minutes long, that is actually a very impressive number. However, he ended up updating the description, and in the video, to be fair, he mentions that it is sponsored by GoPro, but he doesn't mention anything about selling shares or his ownership in it .

He has since updated the description. Written here in red, this is the updated part, well, some of this is the updated part. I am the largest shareholder in GoPro and I have talked a lot about " Mission One".

So, this little bit here, these words, "I am the biggest contributor to GoPro". This means the largest individual outside the insider because he owns about 8.5% or so now. That has been added.

Ah, exactly in "Yes, I've been talking about GoPro for months now," right here. " I am the largest shareholder in GoPro and I have been talking about GoPro for months now." Or the new one , oh, he's even updated it to "the new Mission One cameras" months now.

Interesting. It seems like he is trying to restructure the situation somewhat . Oh yeah, I bought it because I was promoting the Mission One because I'm really excited about interchangeable lenses , and you know, this looks like a fridge behind me, but it's actually a dry storage space for lenses because I'm really into lenses and now GoPro has interchangeable lenses .

I love that. That's why I'm going to buy the stock because I'm really optimistic about it. This is an acceptable defense and a reasonable argument. But I am just saying, invest $9 million based on your belief that this company, which is losing a lot of money, has no chance of surviving the next twelve months.

To put $9 million into the stock within, you know, 60 days of announcing a merger seems a bit suspicious. Because it was very possible that they would declare bankruptcy by January.

I succeeded in choosing the 60 days immediately preceding the merger. Good. maybe?

Let's take a look at what he said on Philippe DeFranco's show, because here he gives his point of view on the story, so to speak . And, well, let's see if that matches what is being said.

Contact Markiplier. Among other things we discussed, he explained why he believed it was undervalued. I thought that what the market value was saying was a low valuation simply because of the name.

They are literally that , that's the point. That's good. This may not be a good financial analysis, but I mean, if you're looking at a company with a market value of $105 million and they literally owe $230 million.

Some argue that even $105 million is too high a sum . And that the value must be zero. Because their debts are much greater than that . Like Linux in cameras, because people call any action camera a "GoPro" even if it's not that brand.

That makes sense. He is, you know, no one argues that he is a financial expert. He says, "Hey, GoPro is a big, familiar name. I think it should be worth more." "The timing is really bad if that's true.

So, I assumed from that alone that they had value, but I knew they were planning something. It seems like I knew they were planning something. That's always an interesting sentence, especially when you have what appears to be a branded promotional link , you know, using the Markiplier code.

It kind of suggests that you're talking to people inside the company, which doesn't necessarily mean they've given you inside information.

Is it possible that there were some indirect hints that occurred? Like, ' Hey man, yeah, the stock is about to go up.'" "Don't tell anyone." The company had already announced it was up for sale.

There was very clear disclosure that the founder was offering a bailout loan. It was very clear they were close to bankruptcy . All of that was public information.

But insiders at GoPro knew they were in talks to be acquired. Maybe my knowing they were planning something was enough of a vague hint to make me confident enough to invest $9 million at that time.

Does that amount to inside information trading? Where I have to file paperwork and say, " I'm the owner of this company." I've never done that for any company before . It was simply, you know, I really believed in it and I said to myself, " This looks like a good investment."

Based on what financial metric? Based on which part of the balance sheet , or the cash flow statement, or the income statement? The part where they're losing money? $51 billion or $1 million every quarter?

The part where their profit margins are getting worse, where their costs aren't decreasing as quickly as their revenue? Was that part? Was it the fact that they don't have enough money to survive from now until January?

Was that the financial part? Which part? Here, we don't have that. We have terrible financials.

He didn't think about the company for his 13D model and had inside information. Roaring Kitty seems to believe in the company to some extent, at least. He has used GoPro cameras in some of his YouTube videos.

He filmed the behind- the-scenes of his first film, Iron Lung, using one, didn't he ? He is clearly a fan of the company.

I mean, I'm not trying to be fancifully optimistic like, "Oh, they can , it's like, look, they've released their financial statements, you know, I've definitely looked at them, but I've definitely looked at them."

Please explain which part of their financial data you found attractive enough to invest $9 in just before the merger to achieve a 68% profit. this stock has been in freefall for 5 years.

This is an example of GoPro doing that with Mission One. That's a huge risk. Notice how he's renaming everything now like, "Oh, well, it was actually Mission One, man." That was the catalyst.

prior to this report on his investment and before the stock price surged, Markiplier posted a video promoting the new GoPro camera.

That's right, it's called ILS Mission One. It is small in size. It is relatively cheap compared to others, around $700 without any additional equipment. GoPro markets it as a cinematic camera , implying that you can use it for real. bunk.

you know, there simply isn't a proper place to disclose that I own the stocks." "I, you know, had identified it as sponsored and thought that meant I was safe."

I do n't even know if GoPro is aware that I'm an investor because this is just a filing with the Securities and Exchange Commission. Apparently, when you buy shares, the company doesn't know who is buying them until it is publicly disclosed through one of those forms.

Because you are not buying from the company, but from other shareholders.

But I said it was sponsorship from the beginning because I wanted to indicate that I had some financial gain from it. since it basically says, "Oh , I said it was sponsored because I own the shares."

But wait, you had a promotional code. You had the code "Markbler". So, you would say it was sponsored because you own the symbol if that was indeed sponsorship .

what are the chances that the SEC will pursue GoPro and Mark with subpoenas or an investigation?

I think there is roughly a 60% chance that they will investigate this matter. What are the chances that this will result in something actual, and that documented evidence will emerge as " damning proof," such as a text message in which we say that we predicted the stock would rise because we are plotting something, with subtle and indirect hints?

What are the chances of that actually happening? Perhaps closer to 3%.

A defense-focused optics company is also expected to acquire this company. The company is undergoing a reverse merger. Therefore, the stock is expected to remain traded on the public market.

This is one of the reasons why the stock is trading at more than $ 1.14, because you are essentially incorporating this private company into GoPro.

They will then present consolidated financial statements, and hopefully the stock will rise from there. Mark doesn't appear to have sold anything yet . Even if he tries, I imagine the stock will crash because it is not highly liquid .