William Blair analyst Louie DiPalma downgraded Gogo to Market Perform from Outperform saying he "misjudged" the company's ability to improve the profitability of its commercial division in the near term. Last Friday's update conference call revealed that the substantial cost reductions expected in the near term are not anticipated until late 2020, DiPalma tells investors in a research note. While the stock has potential upside with the right strategic transaction, there is risk that it trades down to the $1 range or lower with multiple compression, the analyst adds. Gogo shares closed yesterday at $3.76.

Morgan Stanley lowered the firm's price target on Gogo to $12 from $15 and keeps an Equal Weight rating on the shares. The delayed rollout of the company's 5G offering raises uncertainty around how quickly Gogo can ramp up customer migration to the upgraded service once launched, while long-term competitive pressure from LEO operators such as Starlink is likely to limit upside, the analyst tells investors.