Gogo starts off its update strong by telling investors in its stock that it expects a compounded annual revenue growth rate of 15% from 2020 to 2025. For comparison, the previous compounded annual revenue growth rate guidance was at least 10%.
To go along with that, the company is also expecting its annual Adjusted EBITDA margin to rise from 40% in 2021 to 45% in 2025. That’s a solid improvement over its previous target of 35% in 2021 to 40% in 2025.
The final highlight from the guidance update covers free cash flow. Gogo is expecting $125 million in 2023 after launching its 5G network in 2022. It’s then looking to free cash flow of $200 million in 2025. The previous estimates were for free cash flow over $100 million in 2023 and no specific number afterward.
Oakleigh Thorne, chairman and CEO of Gogo, said this about the news boosting the company’s stock.
“Growth in private air travel continues to expand, fueling what we expect will be sustained growth in demand for inflight connectivity as customers seek to replicate their home and office connectivity in the air. That has driven record equipment sales at Gogo and is expected to generate growth in high-margin service revenue through our 2025 planning horizon.”
GOGO stock is seeing heavy trading on today’s news. As a result, some 18 million shares have changed hands as of this writing. That’s a hefty increase over its daily average trading volume of about 897,000 shares.
GOGO stock was up 28.8% as of Tuesday afternoon and is up 64.4% since the start of the year.
Investors looking for more hot stock news today will want to keep reading!
We’ve got all the latest stock news that traders need to know about for Tuesday. That includes why crypto markets are down, what to know about Planet Green Holdings (NYSEAMERICAN:PLAG), and a midday market update covering today’s stock market fall. You can find all of that at the following links!
More Stock Market News for Tuesday
- BTC, ETH, ADA, XRP: Why Is the Crypto Market Down Today?
- 5 Things for PLAG Stock Investors to Know About China Tea Play Planet Green Holdings as Shares Heat Up
- Midday Market Update: Why Are Stocks Down Today?
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.