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Why Boingo Wireless Stock Popped 10% This Morning

By Rich Smith – Updated Apr 25, 2019 at 3:28PM

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Boingo stock is looking like a "hot" spot to be after its earnings beat.

What happened

Shares of wireless "hotspot" specialist Boingo Wireless (WIFI) jumped 10% in early trading Thursday before settling down to enjoy a 4.1% gain by close of trading. Investors were reacting to Boingo's Q4 earnings report, released after close of trading on Wednesday, which showed the company earning a surprise GAAP profit of $0.01 per share -- versus the $0.09 per-share loss that analysts had predicted.

So what

Boingo's $0.01 per-share profit marked a reversal of the $0.02 per-share loss that Boingo suffered in the year-ago quarter. And this wasn't Boingo's only good news. Q4 revenues climbed 18% year over year, to $67.8 million.

For the year, sales climbed 23%, to $250.8 million. Although Boingo ended the year with a $0.03 per-share loss, this was still a marked improvement over the $0.49 per share that Boingo lost in 2017.

Check out the latest Boingo earnings call transcript.

Wifi icon.

Image source: Getty Images.

Now what

As for 2019, Boingo issued new guidance last night. For the first quarter of the new year, management expects to lose somewhere between $0.14 and $0.21 per share on revenue of from $63 million to $68 million. For the full year, Boingo expects its losses to swell to $0.34 to $0.45 per share on sales of $270 million to $280 million.

Incidentally, this last set of numbers may explain why Boingo was unable to hold on to all the gains its stock enjoyed from the Q4 "earnings beat." Right now, analysts are still predicting that Boingo will lose only $0.14 per share in 2019 on sales of nearly $292 million. Boingo's guidance appears to be setting up the stock for a sizable earnings (and sales) miss by the end of the year.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool owns shares of Boingo Wireless. The Motley Fool has a disclosure policy.

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