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On Thursday, shares of wearable action camera maker GoPro Inc. (GPRO - Free Report) are soaring, up over 14% in morning trading after the company updated its third quarter guidance.

GoPro said that it now expects revenue and gross margin to be at the high end of its previously expected ranges, with Q3 revenues coming in between $290 million to $310 million and gross margin between 36% to 38%. GoPro also forecasts adjusted profitability for the quarter.

In an interview with CNBC’s “Squawk Box,” GoPro Chief Operating Officer CJ Porber said that "We set some stretch forecasts at the beginning of the year to be profitable on a non-GAAP basis for all of 2017 and post double-digit revenue growth. And we expect to do that.”

“The bigger picture even beyond this quarter is that we’re seeing really strong consumer demand for our products and were successfully turning the business around,” he continued.

Since October, GPRO has fallen almost 50% due to investor skepticism and broad concerns that the company is losing ground to smartphones and similar devices from competitors like Garmin (GRMN - Free Report) and Sony (SNE - Free Report) . On top of this, the delay in the launch of its much-hyped Karma drone and production issues with its Hero 5 camera negatively affected sales and put unwanted pressure on GoPro’s stock.

However, GoPro did say it is still on track to launch the Hero 6, which is the latest edition of its flagship action cameras, in addition to the company’s new Fusion 360 camera, by the upcoming holiday season.

GoPro In-Depth

Since its June 2014 IPO, GoPro has undoubtedly struggled. While the stock jumped nearly 31% on its first day of trading, and soon hit an all-time high of almost $94 per share just a few months after, GoPro shares have lost roughly 90% of its value since then (as of Wednesday’s close).

GPRO is currently a Zacks Rank #3 (Hold). Along with its updated third quarter guidance, GoPro expects earnings growth for current year of over 97% and sales growth of 12.6% in the same time frame. From a growth perspective, the company looks promising, though perhaps it’s because GoPro has finally worked out some major production issues.

GoPro’s valuation, however, is tricky, and because it has suffered a long bout of losses, it currently has no price-to-earnings. Looking at the camera maker’s price-to-sales ratio, GoPro sits at 0.97, which matches the Audio Video Production industry’s P/S.

Based on P/S, GoPro’s value has significantly cheapened, steadily decreasing since it hit its all-time high about three years ago. Its guidance announcement today is a step in the right direction, especially after its smaller-than-expected second-quarter loss, to boosting profits, increasing sales, and regaining some of its value back.

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