There are a lot of smart people out there who say that GoPro Inc (NASDAQ:GPRO) stock will never be a buy, regardless of the stock price. That thesis is built on the notion that GPRO stock is an unprofitable one-trick pony headed for Wall Street’s graveyard.

But even as an outspoken bear on GPRO stock, I don’t buy that thesis.

GPRO is unprofitable. Now. But it was running at 10% operating margins not too long ago. Earnings are inflecting upward and heading towards full-year positive territory for the first time in a while.

Yes, GPRO is a one-trick pony. But it’s a pretty talented one-trick pony. The company has a tiny addressable market that isn’t really growing all that much, but GPRO dominates that niche market. As far as action cameras are concerned, GPRO still doesn’t have much competition.

Growing profit margins, plus sustainable demand in a niche market, means GPRO stock isn’t heading for any graveyard anytime soon. A solid balance sheet also means this stock isn’t going to $0 in the foreseeable future.

So here’s the big question: At what price should you start buying GPRO stock?

I’m a buyer below $8. Here’s why.

Why GPRO Stock Becomes a Buy at $8

GoPro will never be that big. That seems like an obvious truth now, but remember that this stock was hyped as the next big content play not too long ago. GPRO was going to transform the way everyone consumed media content.

Until it didn’t.

GoPro novelty faded. Most consumers found out that they don’t need an action camera after all. As it turns out, not everyone surfs, snowboards, skates and/or dirt bikes. We all do stuff that is worthy of recording, but Apple Inc. (NASDAQ:AAPL) already has us covered there because iPhone cameras are just so good these days.

GoPro’s addressable market shrank. Sales fell. Profits disappeared.

But now GPRO is turning around somewhat because management is realizing its shortcomings. Instead of shooting for the stars, GPRO is fighting to live another day. The result is that the company is actually developing a suite of pretty good software products that its core user-base loves. Plus, the expansion into the drone market offers another cross-selling opportunity.

Sales are rebounding. Profits are coming back.

Stable camera sales plus incremental drone revenue should allow for roughly 10% revenue growth per year over the next several years. Meanwhile, gross margins are low enough to a point where they should start stabilizing. Operating expenses should be levered, thanks to revenue growth and cost-cutting.

But even if GoPro does grow revenues 10% per year over the next 5 years and gets operating margins to around 10% (where they were in 2012 and 2013), that is still only $1.9 billion in revenues and $190 million in operating profits in 5 years. Slap a 34% tax rate on that and divide by about 136 million diluted shares, and you get to about $0.90 in earnings per share in five years.

Throw a long-term average 16 times price-to-earnings multiple on that $0.90 earnings base. You get a $14.50 stock in 5 years.

Discount that back by 10% per year. You get to a present value of $9.

Bottom Line on GPRO Stock

If the present value is $9, I’m not a buyer until GPRO stock trades at a discount to that price level. A 10% discount feels adequate. Consequently, I’m a buyer below $8.

As is turn outs, $8 has acted as a floor for GPRO stock over the past year.

I like it when technicals and fundamentals line up to provide a similar buy target. It gives me high conviction in buying GPRO stock below $8.

Of course, a blowout holiday season could dramatically change this thesis. So could a really, really bad holiday season. But right now, the price to buy GPRO stock is below $8.

As of this writing, Luke Lango did not hold a position in any of the aforementioned securities.