Merrill Lynch analyst Jason Mitchell initiates coverage on GoPro Inc (NASDAQ:GPRO), recognizing substantial opportunity at play for investors. Amid a new product cycle (the Hero5 series) and new cloud-connected camera software, Mitchell sees the action camera giant about to break free from its past struggles, highlighting key positives.

As such, the analyst initiates a Buy rating on GPRO with a price target of $19, which represents a 27% increase from where the shares last closed.

From Mitchell’s perspective, the new Hero5 series could be just what GPRO needs to rebound. Moreover, with the upgraded camera technology, Mitchell recognizes “potential for cloud platform monetization.” Additionally, as channel inventory has significantly waned, the analyst believes this “should allow for normalized channel sell-in in 4Q.”

Ultimately, Mitchell foresees a beat on the company’s hands, anticipating the Karma Drone accessory will outperform the Street’s projections of $1.7 billion for revenue in the fiscal year of 2017. In contrast, Mitchell expects $1.85 billion, taking into account the growing drone market, and the company’s massive sales potential on back of “new products and balanced channel inventory.”

As far as the risks Mitchell recognizes, the analyst does understand it is not to be taken lightly that GPRO must confront new competition in the midst of a shrinking end market for total digital camera/camcorders, while dealing with additional pressure prospects from smartphones and low-end manufacturers. However, for Mitchell, “These are long term downward pressures for the industry as a whole, but we see near term opportunity […]”

“GoPro has faced a challenging 2015/1H16, with lower-end products launched at confusing price points overfilling channel inventory, but after several months of inventory burn down, new product launches around the corner, and a new focus on cloud connectivity and software, we think GoPro is ready to make a hero’s comeback in 4Q16,” Mitchell concludes.

TipRanks analytics demonstrate GPRO as a Hold. Based on 10 analysts polled in the last 3 months, 20% rate a Buy on GPRO, 60% maintain a Hold, while 20% issue a Sell. The consensus price target stands at $11.43, marking a nearly 24% downside from where the stock is currently trading.screen-shot-09-19-16-at-01-50-pm