Gogo Inc. (GOGO:NASDAQ) reported its Q3/24 financial results, and they slightly exceeded expectations, reported Scott Searle, managing director at ROTH Capital Partners, in a Nov. 5 research note. The company provides in-flight connectivity services to business aviation markets through its North American terrestrial air-to-ground network.
137% potential return
ROTH maintained its target price of $15.50 per share on Gogo, noted Searle.
"We believe this provides a reasonable 12-plus-month target given the expected impact from two major new product cycles as we enter 2025," he wrote, referring to Galileo, the company's global inflight broadband service, and its 5G product line.
In comparison, the company's current share price is about $6.55 per share. From this price, the return to target reflects 137% upside.
Gogo remains a Buy.
Quarter's highlights
Searle reported that Gogo's Q3/24 service revenue was a beat. At $81.9 million ($81.9M), it was slightly higher than that in Q2/24 and driven by modestly better-than-expected aircraft online, Searle reported. This revenue exceeded ROTH's estimate by about $300,000.
Also of note, Galileo is on track to launch in Q4/24, and Gogo continues to grow its portfolio of supplemental type certificates and partners around the world.
A look ahead
Gogo's outlook for 2024 of $400-410M encompasses consensus' estimate, noted Searle. The company, though, has "pulled long-term guidance ahead of the Satcom Direct [acquisition] closing."
ROTH expects Galileo and 5G will lead recovery, expected in late 2025.
In other news, noted Searle, Gogo Chairman and Chief Executive Officer Oakleigh Thorne will present at ROTH's NYC Tech Event on Nov. 20.
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