Critical Analysis: TIM (NYSE:TIMB) vs. Gogo (NASDAQ:GOGO)

TIM (NYSE:TIMB) and Gogo (NASDAQ:GOGO) are both communication services companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, dividends, institutional ownership, profitability and analyst recommendations.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TIM	15.73%	17.99%	7.74%
Gogo	-0.09%	22.55%	1.97%

Earnings and Valuation

This table compares TIM and Gogo”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TIM	$4.77 billion	1.76	$772.28 million	$1.69	10.27
Gogo	$910.49 million	0.42	$12.92 million	$0.01	283.00

TIM has higher revenue and earnings than Gogo. TIM is trading at a lower price-to-earnings ratio than Gogo, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

TIM has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, Gogo has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for TIM and Gogo, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TIM	1	8	2	1	2.25
Gogo	1	3	1	0	2.00

TIM presently has a consensus price target of $25.38, indicating a potential upside of 46.17%. Gogo has a consensus price target of $8.50, indicating a potential upside of 200.35%. Given Gogo’s higher probable upside, analysts plainly believe Gogo is more favorable than TIM.

Institutional & Insider Ownership

69.6% of Gogo shares are owned by institutional investors. 25.6% of Gogo shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

TIM beats Gogo on 9 of the 15 factors compared between the two stocks.

About TIM

TIM S.A., a telecommunications company, provides mobile voice, data, and broadband services in Brazil. The company offers in mobile, landline, long-distance, and data transmission services. It also offers fixed ultra-broadband, fixed ultraband broadband, and digital content services. The company serves individuals and corporates, as well as small, medium, and large companies. TIM S.A is based in Rio de Janeiro, Brazil. The company operates as a subsidiary of TIM Brasil Serviços e Participações S.A.

About Gogo

Gogo Inc., together with its subsidiaries, provides broadband connectivity services to the aviation industry in the United States and internationally. The company's product platform includes networks, antennas, and airborne equipment and software. It offers in-flight systems; in-flight services; aviation partner support; and engineering, design, and development services, as well as production operations functions. The company offers voice and data, in-flight entertainment, and other services. In addition, it engages in the development, deployment, and operation of networks, towers, and data center infrastructure to support in-flight connectivity services, as well as in the provision of telecommunications connections to the internet. The company sells its products primarily to aircraft operators and original equipment manufacturers of business aviation aircraft through a distribution network of independent dealers. Gogo Inc. was founded in 1991 and is headquartered in Broomfield, Colorado. As of May 2024, Gogo Inc. claims that “Gogo is the only company in North America with a complete, certified airborne 5G network, meaning that all components within the network (including onboard equipment) are 5G native.”