Saturday, October 11, 2014

* GOGO - Is This MOMO Firm Turning the Corner... Or is it "Much Ado?" (3 Charts)

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GOGO is losing money while revenue is growing... pretty much the status quo for growth and MOMO companies right now. But, there are a couple of charts which may point to a turn around; a different set of circumstances that make GOGO look different from the group. 

This isn't meant as a definitive research piece and it certainly isn't complete. But in three charts, we go from knowing very little, to knowing... considerably more.

Net Income Margin %
That bad news is that net income margin (and therefore net income) is negative.  But, we'd have to be blind to not see the improving trend.  Net income margin % loss has been cut in half.

Revenue (TTM) to Net Income (TTM)
On the top (in blue bars) we see revenue, and a rather impressive and consistent 152% growth in the last few years.  On the bottom (the orange line) we see net income. There has been a flattening of the curve (losses) as revenue increases, and then a rather sudden jump up (reduction in losses).

Gross Margin %
There is a counter weight to all of this information (aside form the fact that the firm is losing money), and that's gross margin %.  Possibly the most compelling part of the Internet Services & Software industry is the incredibly high gross margin % (see YELP as an example).  GOGO has seen its gross margin % drop as revenue has grown.  The drop isn't huge, but it is certainly not trivial and it is certainly consistent.

More on GOGO in future posts.

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1 comment:

  1. How about a chart on gogo credit, it recently borrowed 75M credit. How much credit with time will be a worth chart