Telecom Italia (OTCMKTS:TIIAY) and Cogent Communications (NASDAQ:CCOI) are both utilities companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, valuation, analyst recommendations and institutional ownership.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Telecom Italia and Cogent Communications, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Telecom Italia | 1 | 1 | 1 | 0 | 2.00 |
Cogent Communications | 0 | 2 | 3 | 0 | 2.60 |
Cogent Communications has a consensus target price of $77.1667, indicating a potential upside of 11.72%. Given Cogent Communications' stronger consensus rating and higher probable upside, analysts clearly believe Cogent Communications is more favorable than Telecom Italia.
Risk & Volatility
Telecom Italia has a beta of 1.25, meaning that its share price is 25% more volatile than the S&P 500. Comparatively, Cogent Communications has a beta of 0.1, meaning that its share price is 90% less volatile than the S&P 500.
Earnings & Valuation
This table compares Telecom Italia and Cogent Communications' revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Telecom Italia | $20.13 billion | 0.56 | $1.03 billion | $0.55 | 9.76 |
Cogent Communications | $546.16 million | 6.02 | $37.52 million | $0.76 | 90.88 |
Telecom Italia has higher revenue and earnings than Cogent Communications. Telecom Italia is trading at a lower price-to-earnings ratio than Cogent Communications, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
81.8% of Cogent Communications shares are held by institutional investors. 10.7% of Cogent Communications shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Dividends
Telecom Italia pays an annual dividend of $0.31 per share and has a dividend yield of 5.8%. Cogent Communications pays an annual dividend of $3.02 per share and has a dividend yield of 4.4%. Telecom Italia pays out 56.4% of its earnings in the form of a dividend. Cogent Communications pays out 397.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cogent Communications has increased its dividend for 8 consecutive years. Telecom Italia is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares Telecom Italia and Cogent Communications' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Telecom Italia | N/A | N/A | N/A |
Cogent Communications | 3.60% | -17.36% | 4.16% |
Summary
Cogent Communications beats Telecom Italia on 11 of the 17 factors compared between the two stocks.