My Advice for Boingo Wireless

wifi signal on mobile

Boingo Wireless, Inc. (WIFI) is looking to be a quality stock for investors. It has been reported that four major investment brokers labeled Boingo Wireless with an average rating of 1.00, which equates to a “strong buy.” Is this time to buy shares?

According to Zacks Investment Research, four equities research analysts have established a 12-month consensus target price of $11.42 and project a $0.17 earnings per share for the second quarter of 2015.

Jefferies Group analysts raised their price target of Boingo Shares from $9 to $10 and labeled it as a “buy.” In addition, DA Davidson analysts increased their price target for the company’s shares from $10 to $13 and also inserted a “buy” rating.

Zacks, however, downgraded the stock from a “hold” to a “sell.” Octafinance remains the only party to be “NEUTRAL” on the stock.

Moreover, Boingo Wireless received an industry rank of 161 out of 265 from Zacks, which was concluded based on the ratings allocated to industry-related firms.

Insider Selling Turns Heads on Wall Street

The company generated headlines after it was reported that CFO Peter Hoevenier had sold 10,000 shares on Jul. 14. The CFO sold shares at an average price of $8.94 for a grand total of $89,400. At the present time, Hoevenier owns 73,480 shares, or about $656,911, of Boingo Wireless stock.

CMO Dawn Callahan sold 33,466 shares of Boingo Wireless stock at an average price of $9.00 for a total value of $301,194.00.

Back in May, CEO David Hagan sold 25,000 shares at an average price of $8.50 (http://www.octafinance.com/an-insider-david-hagan-sold-25000-shares-of-boingo-wireless-inc-nasdaqwifi/) worth more than $212,000.

These three transactions were discovered from Securities and Exchange Commission (SEC) filings.

Corporate Earnings Data

In May, Boingo Wireless released its earnings data. The mobile Wi-Fi internet solutions provider reported $0.22 earnings per share for the quarter. It had revenue of $29.40 million, which beat the analysts’ estimates of $27.7 million. Revenues are up 10.9 percent compared to the same quarter last year.

Wall Street brokerage analysts project $-0.17 earnings per share for the fiscal quarter ending Jul. 30. Many analysts do expect Boingo Wireless to post $-0.59 earnings per share for the current fiscal year.

Boingo Wireless will report its next earnings results on Aug. 6.

Boingo Wireless Performance in Recent Years

 

Since 2010, the provider of commercial mobile Wi-Fi Internet solutions has seen its stock sliced in half. Immediately following the economic collapse, shares were trading between $10 and $13. However, since 2013, investors have seen the stock trade between just under $6 to just under $10.

At the time of this writing, Boingo Wireless shares are trading at $9.05. Year-to-date, Boingo Wireless has been trading in positive territory at around 18 percent.

It’s a Long Stock

Since its founding in 2001, Boingo Wireless has transformed and expanded its business model. Previously, the company just installed Wi-Fi at airports, which accounted for 30 percent of its revenues. But today they have touched upon a wide variety areas, like military bases and sports stadiums.

“We have about 100 network build projects going on right now, and that is a huge execution challenge, managing those and making sure they get built on time and on budget. That’s what keeps me up at night,” Hagan told the Los Angeles Times. “The good news is we have about as much business as we can possibly handle.”

Despite the company’s growing business, its losses have widened particularly in the last two years. In eight of the last nine quarters, it has lost money and its revenues have fluctuated, especially in its advertising realm.

Hagan blamed the tumbling revenues and profits on its efforts to boost capital spending to expand and build out its networks, like military bases and arenas.

With Wi-Fi becoming ever more important to the general population and commercial establishments, Boingo Wireless stock may be something to add to the “long” portion of your investment portfolio.

As always, do your homework (due diligence) prior to any significant investment. 

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