Gogo (NASDAQ: GOGO) and pdvWireless (NASDAQ:PDVW) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, earnings, risk, valuation, analyst recommendations and institutional ownership.

Profitability

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

Net Margins Return on Equity Return on Assets
Gogo -22.58% N/A -11.62%
pdvWireless -711.56% -15.52% -14.61%

Institutional and Insider Ownership

66.5% of Gogo shares are owned by institutional investors. Comparatively, 93.0% of pdvWireless shares are owned by institutional investors. 37.7% of Gogo shares are owned by company insiders. Comparatively, 10.9% of pdvWireless shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Gogo and pdvWireless’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Gogo $645.47 million 1.83 $74.39 million ($1.84) -7.40
pdvWireless $5.21 million 79.42 -$27.65 million ($2.57) -11.17

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

Volatility & Risk

Gogo has a beta of 1.79, meaning that its stock price is 79% more volatile than the S&P 500. Comparatively, pdvWireless has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Gogo and pdvWireless, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gogo 0 1 4 0 2.80
pdvWireless 0 0 2 0 3.00

Gogo presently has a consensus price target of $16.00, indicating a potential upside of 17.56%. pdvWireless has a consensus price target of $51.00, indicating a potential upside of 77.70%. Given pdvWireless’ stronger consensus rating and higher possible upside, analysts clearly believe pdvWireless is more favorable than Gogo.

Summary

Gogo beats pdvWireless on 9 of the 13 factors compared between the two stocks.

About Gogo

Gogo Inc. is a holding company. The Company is a provider of in-flight broadband connectivity and connectivity-enabled services to commercial and business aviation. The Company 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 air-to-ground (ATG) and satellite connectivity and entertainment services to commercial aircraft flying routes generally within North America. The CA-ROW segment offers satellite connectivity and entertainment services, using 2Ku and Ku solutions, to commercial aircraft flying routes outside of North America. The Company’s BA segment offers a suite of integrated equipment, network and Internet connectivity products and services to the business aviation market. As of December 31, 2016, it provided services on 2,943 commercial aircraft. The Company offers a package of airborne equipment for its ATG-4/ATG and satellite services.

About pdvWireless

pdvWireless, Inc., formerly Pacific DataVision, Inc., is a wireless communications carrier and a provider of mobile workforce communication and location-based solutions. The Company’s solutions focus on enhancing the productivity of its customers’ field-based workers, and the efficiency of their dispatch and call center operations. The Company is deploying and operating the two-way radio networks that offer push-to-talk (PTT) communications services to primarily dispatch-centric, small and medium-sized businesses. The Company has launched its PTT networks in markets throughout the United States. The Company offers its DispatchPlus service, which combines pdvConnect, its suite of mobile communication and workforce management applications with digital network architecture and mobile devices. Developed for dispatch-centric businesses, pdvConnect enables businesses to locate and communicate with their field workers.

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