Comparing Gogo (NASDAQ:GOGO) and SoftBank Group (OTCMKTS:SFTBY)

SoftBank Group (OTCMKTS:SFTBY) and Gogo (NASDAQ:GOGO) are both communication services companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, earnings, analyst recommendations, valuation, dividends and institutional ownership.

Insider and Institutional Ownership

0.0% of SoftBank Group shares are owned by institutional investors. Comparatively, 69.6% of Gogo shares are owned by institutional investors. 25.6% of Gogo shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

SoftBank Group has a beta of 1.87, meaning that its share price is 87% more volatile than the S&P 500. Comparatively, Gogo has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for SoftBank Group and Gogo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SoftBank Group	1	3	5	0	2.44
Gogo	2	2	1	0	1.80

Gogo has a consensus target price of $8.50, suggesting a potential upside of 219.55%. Given Gogo’s higher possible upside, analysts clearly believe Gogo is more favorable than SoftBank Group.

Earnings and Valuation

This table compares SoftBank Group and Gogo”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SoftBank Group	$51.81 billion	3.66	$33.01 billion	$2.83	5.86
Gogo	$910.49 million	0.40	$12.92 million	$0.01	266.00

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
SoftBank Group	62.60%	26.38%	8.87%
Gogo	-0.09%	22.55%	1.97%

Summary

SoftBank Group beats Gogo on 10 of the 14 factors compared between the two stocks.

About SoftBank Group

SoftBank Group Corp. provides telecommunication services in Japan and internationally. It operates through Investment Business of Holding Companies, SoftBank Vision Funds, SoftBank, Arm, and Other segments. The company offers mobile communications and solutions to enterprise customers, and broadband services to retail customers; and sells mobile devices and software tools, as well as related services. It also provides internet advertising and e-commerce services; payment and financial services; ICT services products to enterprise customers; and communication device-related products and IoT equipment to retail customers. In addition, the company engages in design of microprocessor intellectual property and related technology; alternative investment management; ownership of professional baseball team; operation of baseball games; management and maintenance of baseball stadium and other sports facilities; distribution of video, voice, and data content via media businesses. Further, it engages in the certification services, security solutions, and Linux / OSS businesses; operation of comprehensive IT information site ITmedia; sale of indirect materials such as consumable supplies; facility management; planning and operation of fashion e-commerce website; operational support of brands' own e-commerce website; operation of fashion coordination app; management of few funds; generation of electricity from renewable energy sources; and supply and sale of electricity. The company was formerly known as SoftBank Corp. and changed its name to SoftBank Group Corp. in July 2015. SoftBank Group Corp. was incorporated in 1981 and is headquartered in Tokyo, Japan.

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.”