TeraGo Inc. (TGO) AI Stock Analysis

• Market Cap: C$23.26M
• Dividend Yield: N/A
• Average Volume (3M): 4.41K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.15
• Revenue Growth: 0.38%
• EPS Growth: 7.22%
• Country: CA
• Employees: 98
• Sector: Communication Services
• Sector Strength: 93
• Industry: Telecommunications Services
• EPS (TTM): -0.08
• Shares Outstanding: 20,053,411
• 10 Day Avg. Volume: 3,307
• 30 Day Avg. Volume: 4,413
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$1.00
• Price Target Upside: -13.79% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 50 Neutral
• Price Target: C$1.00 ▼(-13.79% Downside)

TeraGo Inc.'s overall stock score reflects significant financial challenges, including declining revenues and high debt levels. However, strategic initiatives such as customer base optimization and partnerships for 5G solutions provide a positive outlook. The stock's technical indicators suggest bearish momentum, and its valuation is unattractive due to unprofitability.

TeraGo Inc. Business Overview & Revenue Model

Company Description

TeraGo Inc. (TGO) is a Canadian technology company that specializes in providing cloud services, data center solutions, and connectivity solutions to businesses across various sectors. The company focuses on offering enterprise-grade services, including hybrid cloud, colocation, and network connectivity to help organizations optimize their IT infrastructure and enhance operational efficiency.

How the Company Makes Money

TeraGo Inc. makes money through a diversified revenue model primarily based on subscription and service fees for its cloud and data center offerings. Key revenue streams include recurring subscription fees for cloud infrastructure services, colocation services where businesses rent physical space for their servers, and managed network services that provide reliable connectivity solutions. Additionally, TeraGo may generate revenue from professional services offered to customize and optimize solutions for clients. Strategic partnerships with technology providers and vendors also play a role in enhancing TeraGo's service offerings and expanding its market reach, contributing to its earnings.

TeraGo Inc. Financial Statement Overview

Summary

TeraGo Inc. displays weak financial health with declining revenues, consistent net losses, and high debt levels. Despite a strong gross profit margin, negative net profit and EBIT margins highlight significant operating expenses. Challenges in cash flow management and high debt-to-equity ratio further underscore financial instability.

Income Statement

TeraGo Inc.'s income statement reveals a challenging period with declining revenues over the years and a consistent net loss. The TTM (Trailing-Twelve-Months) gross profit margin is 73.56%, which is strong, but the net profit margin is negative due to significant net losses. Despite a positive EBITDA margin of 12.38% in TTM, the EBIT margin remains negative, indicating high operating expenses relative to revenue. The company's revenue growth is negative, indicating a contraction in sales. Overall, the financial health from an income perspective is weak with potential areas for improvement in cost management and revenue generation.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 27.17 in TTM, indicating reliance on debt financing. The equity ratio is low at 3.19%, reflecting minimal shareholder equity relative to total assets. The return on equity is negative due to substantial net losses. The company needs to improve its capital structure by reducing liabilities or increasing equity to stabilize its financial position.

Cash Flow

Cash flow analysis shows mixed results with a positive operating cash flow to net income ratio of 0.28 in TTM, indicating some ability to convert income into cash. However, the free cash flow growth rate is negative, reflecting challenges in maintaining positive cash flow after capital expenditures. The free cash flow to net income ratio is just 0.05, showing minimal free cash flow relative to net income. The cash flow statement suggests the need for better cash management strategies.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	26.16M	26.05M	27.62M	43.30M	45.45M
Gross Profit	19.18M	19.10M	20.18M	32.16M	35.63M
EBITDA	2.79M	876.00K	603.00K	3.28M	11.33M
Net Income	-13.27M	-13.19M	-11.57M	-15.17M	-8.26M
Balance Sheet
Total Assets	53.99M	53.50M	55.38M	93.23M	103.17M
Cash, Cash Equivalents and Short-Term Investments	4.42M	4.64M	7.38M	5.48M	5.86M
Total Debt	44.33M	31.93M	20.50M	35.91M	56.16M
Total Liabilities	49.07M	36.16M	25.78M	52.97M	62.30M
Stockholders Equity	4.92M	17.33M	29.60M	40.26M	40.87M
Cash Flow
Free Cash Flow	1.48M	-5.45M	-4.96M	1.94M	5.72M
Operating Cash Flow	5.01M	501.00K	1.25M	9.32M	13.33M
Investing Cash Flow	-3.52M	-5.02M	18.82M	-7.75M	-7.58M
Financing Cash Flow	-1.90M	2.69M	-19.34M	-1.95M	-8.58M

TeraGo Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TGO, the sentiment is Negative. The current price of 1.16 is below the 20-day moving average (MA) of 1.22, below the 50-day MA of 1.23, and below the 200-day MA of 1.26, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 36.48 is Neutral, neither overbought nor oversold. The STOCH value of 16.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:TGO.

TeraGo Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RCI.B	75 Outperform	$25.48B	16.46	13.68%	4.25%	1.87%	71.51%
T	72 Outperform	$33.67B	34.38	6.08%	7.28%	2.56%	21.28%
BCE	69 Neutral	$30.95B	73.64	2.91%	10.21%	-0.66%	-78.79%
CCA	61 Neutral	$2.61B	7.95	10.54%	5.97%	-0.76%	-1.21%
Sector *	60 Neutral	$43.99B	4.18	-7.47%	4.06%	2.47%	-40.32%
CGO	57 Neutral	C$552.63M	6.21	10.54%	6.35%	-0.87%	9.49%
TGO	50 Neutral	C$23.26M	―	-170.20%	―	0.38%	7.22%

TeraGo Inc. Corporate Events

TeraGo Inc. Optimizes Customer Base Amidst Strategic Revenue Adjustments

TeraGo Inc. reported a strategic reduction in revenue for the second quarter and first half of 2025 due to a deliberate decision to let unprofitable customers churn, aligning with their long-term value creation strategy. Despite this, the company saw improvements in key metrics such as ARPA and backlog MRR, indicating a focus on profitable revenue generation and customer base optimization. The company remains confident in refinancing its debt facility and is well-positioned for future growth, bolstered by its significant mmWave spectrum holdings.

TERAGO Inc. Schedules Investor Call for Q2 2025 Financial Results

TERAGO Inc. has announced an investor conference call scheduled for August 13, 2025, to discuss its second-quarter financial results for 2025, which will be released on August 12, 2025. This announcement is significant as it provides stakeholders with insights into the company’s financial health and operational performance, potentially impacting its market positioning and investor relations.

TERAGO Inc. Re-elects Board Members at 2025 Shareholder Meeting

TERAGO Inc. announced the re-election of all six nominees to its board of directors during the 2025 annual meeting of shareholders. This re-election ensures continuity in leadership as the company continues to leverage its extensive mmWave spectrum holdings to provide innovative wireless solutions, reinforcing its position in the Canadian market.

TERAGO Partners with Ericsson to Advance Private 5G Solutions in Canada

TERAGO Inc. has announced a strategic partnership with Ericsson to deliver advanced private 5G solutions across Canada. This collaboration aims to enhance operational efficiency and innovation for businesses by providing high-speed, low-latency connectivity, particularly benefiting sectors such as manufacturing, transportation, and logistics. As a member of Ericsson’s 5-star partner program, TERAGO is set to become a preferred provider of secure wireless network infrastructure, positioning itself to capitalize on the growing demand for seamless and secure connectivity in the digital age.

TeraGo Inc. Reports Q1 2025 Financial Results with Focus on Profitability and Efficiency

TeraGo Inc. reported its financial results for the first quarter of 2025, highlighting a disciplined focus on profitability and efficiency. Despite a slight decrease in total revenue due to increased churn from discontinuing unprofitable accounts, the company saw a 10.9% increase in Adjusted EBITDA, driven by higher gross margins and lower operating expenses. The company also noted a significant increase in backlog MRR and ARPA, reflecting its strategy to attract larger, multi-location customers. The recent consultation by Innovation, Science and Economic Development Canada (ISED) regarding mmWave spectrum is seen as a positive development, providing regulatory clarity and supporting TeraGo’s strategy in the evolving connectivity landscape.