Gogo (GOGO) and DigitalGlobe (DGI) Financial Contrast

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DigitalGlobe (NYSE: DGI) and Gogo (NASDAQ:GOGO) are both computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares DigitalGlobe and Gogo’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DigitalGlobe N/A N/A N/A
Gogo -20.65% N/A -11.83%

Insider and Institutional Ownership

74.3% of Gogo shares are held by institutional investors. 1.9% of DigitalGlobe shares are held by insiders. Comparatively, 36.2% of Gogo shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for DigitalGlobe and Gogo, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DigitalGlobe 0 1 0 0 2.00
Gogo 1 4 2 0 2.14

DigitalGlobe presently has a consensus target price of $34.00, indicating a potential downside of 1.16%. Gogo has a consensus target price of $6.17, indicating a potential upside of 26.89%. Given Gogo’s stronger consensus rating and higher possible upside, analysts clearly believe Gogo is more favorable than DigitalGlobe.

Earnings & Valuation

This table compares DigitalGlobe and Gogo’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DigitalGlobe $725.40 million 2.95 $26.50 million N/A N/A
Gogo $699.09 million 0.60 -$171.99 million ($2.17) -2.24

DigitalGlobe has higher revenue and earnings than Gogo.

About DigitalGlobe

DigitalGlobe, Inc. is a provider of Earth imagery, data and analysis. The Company’s imagery solutions and other services support a range of uses, including mission-planning, mapping and analysis, environmental monitoring, oil and gas exploration and infrastructure management. The Company’s imagery solutions and other services are sourced from its own satellite constellation and third-party providers. The Company sells its products and services through a combination of direct and indirect channels, consisting of a global network of resellers, strategic partners and direct enterprise sales to its United States Government and Diversified Commercial customer groups. The Company offers products consisting of imagery from its constellation of satellites, and provides geospatial products and services. The Company processes its imagery to varying levels according to its customers’ specifications and delivers its products using the distribution method.

About Gogo

Gogo Inc., through its subsidiaries, provides inflight broadband connectivity and wireless entertainment services to the aviation industry in the United States and internationally. It operates through three segments: Commercial Aviation North America (CA-NA), Commercial Aviation Rest of World (CA-ROW), and Business Aviation (BA). The CA-NA segment offers inflight connectivity and wireless digital entertainment solutions to commercial airline passengers flying routes that generally begin and end within North America. The CA-ROW segment provides inflight connectivity and wireless digital entertainment solutions to passengers flying on foreign-based commercial airlines and flights outside of North America for North American based commercial airlines. The BA segment offers equipment for inflight connectivity, including voice and data services to the business aviation market. Its services include AVANCE, an inflight broadband service that utilizes air-to-ground (ATG) network and ATG spectrum; Passenger Entertainment, an inflight entertainment service; and satellite-based voice and data services through strategic alliances with satellite companies. This segment serves aircraft manufacturers, owners, and operators, as well as government and military entities. The company was founded in 1991 and is headquartered in Chicago, Illinois.

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