TSX:TGO

Stock Analysis Report

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Executive Summary

TeraGo Inc., together with its subsidiaries, provides connectivity, colocation, and enterprise infrastructure cloud services for businesses primarily in Canada.


Snowflake Analysis

Mediocre balance sheet with weak fundamentals.


Similar Companies

Share Price & News

How has TeraGo's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TGO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.8%

TGO

3.3%

CA Telecom

2.4%

CA Market


1 Year Return

-46.6%

TGO

-9.0%

CA Telecom

-12.4%

CA Market

Return vs Industry: TGO underperformed the Canadian Telecom industry which returned -9% over the past year.

Return vs Market: TGO underperformed the Canadian Market which returned -12.4% over the past year.


Shareholder returns

TGOIndustryMarket
7 Day4.8%3.3%2.4%
30 Day8.6%-4.8%-0.9%
90 Day0.5%5.8%17.3%
1 Year-46.6%-46.6%-4.5%-9.0%-9.4%-12.4%
3 Year20.9%20.9%9.8%-4.9%4.2%-5.7%
5 Year12.6%12.6%19.2%-6.4%22.1%3.8%

Price Volatility Vs. Market

How volatile is TeraGo's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is TeraGo undervalued compared to its fair value and its price relative to the market?

2.2x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: TGO (CA$6.08) is trading above our estimate of fair value (CA$5.63)

Significantly Below Fair Value: TGO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: TGO is unprofitable, so we can't compare its PE Ratio to the Telecom industry average.

PE vs Market: TGO is unprofitable, so we can't compare its PE Ratio to the Canadian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate TGO's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: TGO is overvalued based on its PB Ratio (2.2x) compared to the XN Telecom industry average (1.4x).


Next Steps

Future Growth

How is TeraGo forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

12.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TGO is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: TGO is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: TGO is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: TGO's revenue is expected to decline over the next 3 years (-0.2% per year).

High Growth Revenue: TGO's revenue is forecast to decline over the next 3 years (-0.2% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if TGO's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has TeraGo performed over the past 5 years?

-18.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TGO is currently unprofitable.

Growing Profit Margin: TGO is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: TGO is unprofitable, and losses have increased over the past 5 years at a rate of -18.2% per year.

Accelerating Growth: Unable to compare TGO's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: TGO is unprofitable, making it difficult to compare its past year earnings growth to the Telecom industry (2.8%).


Return on Equity

High ROE: TGO has a negative Return on Equity (-17.41%), as it is currently unprofitable.


Next Steps

Financial Health

How is TeraGo's financial position?


Financial Position Analysis

Short Term Liabilities: TGO's short term assets (CA$12.0M) do not cover its short term liabilities (CA$15.9M).

Long Term Liabilities: TGO's short term assets (CA$12.0M) do not cover its long term liabilities (CA$47.1M).


Debt to Equity History and Analysis

Debt Level: TGO's debt to equity ratio (64.3%) is considered high.

Reducing Debt: TGO's debt to equity ratio has reduced from 94.7% to 64.3% over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable TGO has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: TGO is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 1.9% per year.


Next Steps

Dividend

What is TeraGo current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate TGO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate TGO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if TGO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TGO's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TGO's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.1yrs

Average management tenure


CEO

Tony Ciciretto

3.83yrs

Tenure

CA$697,500

Compensation

Mr. Antonio P. Ciciretto, also known as Tony, has been the Chief Executive Officer and President at Terago Inc. since September 30, 2016 and TeraGo Networks Inc. since October 6, 2016. Mr. Ciciretto is res ...


CEO Compensation Analysis

Compensation vs Market: Tony's total compensation ($USD513.88K) is above average for companies of similar size in the Canadian market ($USD173.28K).

Compensation vs Earnings: Tony's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Antonio Ciciretto
President3.83yrsCA$697.50k0.32% CA$323.9k
David Charron
Chief Financial Officer2.83yrsCA$744.42k0.16% CA$166.0k
Duncan McGregor
Vice President of Operations & Engineering3.08yrsCA$512.71kno data
Mark Lau
VP of Legal5.92yrsCA$354.75k0.010% CA$10.5k
Blake Wetzel
Chief Revenue Officer1.17yrsCA$561.85kno data
Geoffrey Kereluik
Vice President of Salesno datano datano data
Candice Levy
Director of Human Resourcesno datano datano data

3.1yrs

Average Tenure

Experienced Management: TGO's management team is considered experienced (3.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Antonio Ciciretto
President3.83yrsCA$697.50k0.32% CA$323.9k
Richard Brekka
Independent Director7.25yrsCA$58.72k0.0096% CA$9.7k
James Sanger
Independent Director7.25yrsCA$56.44kno data
Gary Sherlock
Independent Director4.08yrsCA$65.58k0.19% CA$196.9k
Matthew Gerber
Independent Chair of the Board3.08yrsCA$126.97k0.34% CA$348.1k
Michael Martin
Independent Director7.25yrsCA$57.11k0.091% CA$92.6k
Laurel Buckner
Independent Director2.08yrsCA$47.33k0.055% CA$55.3k

4.1yrs

Average Tenure

Experienced Board: TGO's board of directors are considered experienced (4.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: TGO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

TeraGo Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: TeraGo Inc.
  • Ticker: TGO
  • Exchange: TSX
  • Founded: 2000
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: CA$101.310m
  • Shares outstanding: 16.66m
  • Website: https://www.terago.ca

Number of Employees


Location

  • TeraGo Inc.
  • 55 Commerce Valley Drive West
  • Suite 800
  • Thornhill
  • Ontario
  • L3T 7V9
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TGOTSX (The Toronto Stock Exchange)YesCommon SharesCACADJun 2007
TRAG.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJun 2007

Biography

TeraGo Inc., together with its subsidiaries, provides connectivity, colocation, and enterprise infrastructure cloud services for businesses primarily in Canada. The company owns and operates a carrier-grade multi-protocol label switching enabled wireline and fixed wireless, and Internet Protocol communications network that provide Internet access, private interconnection, and data connectivity services. It also offers data connectivity services that allow businesses to connect their various sites within a city or across the company’s geographic footprint through a private virtual local area network; and a range of Ethernet-based services over a wireless connection to customer locations. In addition, the company provides data center colocation services that protect and connect its customers’ valuable information assets; disaster recovery services; and managed hosting solutions. It provides data center services for national government agencies, financial services companies, information technology service providers, content and network service providers, and small and medium businesses. Further, the company offers cloud services, including Infrastructure as a Service for compute, storage, disaster recovery cloud solutions, and other services to customers in various industry verticals, federal, provincial and municipal governments and agencies, as well as non-profit organizations. The company provides its services through direct and indirect sales channels. TeraGo Inc. was incorporated in 2000 and is headquartered in Thornhill, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/05 00:02
End of Day Share Price2020/07/03 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.