VANCOUVER - Mogo Inc. (NASDAQ:MOGO) (TSX:MOGO), a Canadian digital wealth and payments company, has announced an amendment to its senior credit facility agreement with affiliates of Fortress Investment Group LLC. The amendment effectively extends the maturity date of the credit facility from July 2, 2025, to January 2, 2026.
The President and CFO of Mogo, Greg Feller, expressed satisfaction with the extension of the company's decade-long financial partnership with Fortress. He highlighted that the amended credit facility would continue to provide Mogo with the necessary resources and flexibility to support its digital lending product.
Mogo, founded in 2003, has positioned itself as a provider of digital financial solutions designed to enhance wealth creation and financial independence for its members. The company boasts over 2 million members and manages an annual payments volume of $9.9 billion. It also holds a roughly 13% equity stake in WonderFi, a leading Canadian cryptocurrency exchange.
The company offers a suite of products aimed at improving financial outcomes for consumers. These include commission-free stock trading, which encourages a long-term investment strategy akin to that of Warren Buffett, and Moka, a managed investing solution that competes with traditional mutual funds and wealth managers. Mogo's subsidiary, Carta Worldwide, also offers a low-cost payments platform servicing card programs in Europe and Canada.
This report is based on a press release statement from Mogo Inc. and does not include any additional commentary or speculation.
InvestingPro Insights
Mogo Inc. appears to be in a transformative stage with its recent credit facility extension, which could provide the company with more operational leeway. However, a glance at the company's financials through InvestingPro data reveals a challenging landscape. With a market capitalization of $43.54 million, Mogo's valuation reflects investor sentiment toward its future prospects. The company's negative P/E ratio of -3.31 for the last twelve months as of Q1 2024 indicates that it has not been profitable during this period. Moreover, Mogo's revenue growth has declined by 7.77% over the same timeframe, underscoring the difficulties it faces in expanding its top-line financials.
On a more positive note, the company's gross profit margin stands at a healthy 60.85%, suggesting that while revenue growth is a challenge, Mogo is maintaining a strong percentage of revenue after accounting for the cost of goods sold. This could be a sign of effective cost control measures or a strong pricing strategy. The recent price uptick of 54.31% over the last six months also indicates a rebound in investor confidence, potentially due to strategic moves like the credit facility amendment.
InvestingPro Tips for Mogo highlight some concerns and opportunities. The company is quickly burning through cash and is not expected to be profitable this year, as analysts do not anticipate a turnaround in the short term. However, Mogo does have liquid assets that exceed its short-term obligations, providing some financial cushion. It's also noteworthy that Mogo does not pay a dividend, which could be a factor for income-focused investors to consider.
For those wanting to delve deeper into Mogo's financial health, there are additional InvestingPro Tips available at https://www.investing.com/pro/MOGO. And if you're considering an InvestingPro subscription, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. With these insights, investors can make more informed decisions regarding Mogo's potential in their portfolios.
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