United States Cellular Corporation (NYSE: USM) and SK Telecom Co. (NYSE:SKM) are both mid-cap computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, institutional ownership, risk and valuation.
Insider and Institutional Ownership
14.7% of United States Cellular Corporation shares are owned by institutional investors. Comparatively, 11.9% of SK Telecom Co. shares are owned by institutional investors. 1.6% of United States Cellular Corporation shares are owned by insiders. Comparatively, 1.0% of SK Telecom Co. shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Earnings & Valuation
This table compares United States Cellular Corporation and SK Telecom Co.’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|United States Cellular Corporation||$3.88 billion||0.80||$625.00 million||$0.58||63.09|
|SK Telecom Co.||$15.21 billion||1.09||$4.04 billion||$2.80||9.34|
SK Telecom Co. has higher revenue and earnings than United States Cellular Corporation. SK Telecom Co. is trading at a lower price-to-earnings ratio than United States Cellular Corporation, indicating that it is currently the more affordable of the two stocks.
This table compares United States Cellular Corporation and SK Telecom Co.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|United States Cellular Corporation||1.26%||1.12%||0.58%|
|SK Telecom Co.||11.62%||12.56%||6.73%|
SK Telecom Co. pays an annual dividend of $0.72 per share and has a dividend yield of 2.8%. United States Cellular Corporation does not pay a dividend. SK Telecom Co. pays out 25.7% of its earnings in the form of a dividend.
Volatility and Risk
United States Cellular Corporation has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500. Comparatively, SK Telecom Co. has a beta of 0.41, indicating that its share price is 59% less volatile than the S&P 500.
This is a summary of recent recommendations for United States Cellular Corporation and SK Telecom Co., as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|United States Cellular Corporation||1||2||0||0||1.67|
|SK Telecom Co.||0||2||1||0||2.33|
United States Cellular Corporation currently has a consensus target price of $35.50, suggesting a potential downside of 2.98%. Given United States Cellular Corporation’s higher possible upside, research analysts plainly believe United States Cellular Corporation is more favorable than SK Telecom Co..
SK Telecom Co. beats United States Cellular Corporation on 10 of the 16 factors compared between the two stocks.
About United States Cellular Corporation
United States Cellular Corporation (U.S. Cellular) is a provider of wireless telecommunication services. The Company’s wireless operating markets are in the United States. U.S. Cellular provides service to postpaid and prepaid customers from a range of demographic segments. The Company focuses on retail consumers, government and small-to-mid-size business customers in industries, such as construction, retail, professional services and real estate. The Company offers a range of wireless devices, such as handsets, modems, mobile hotspots, home phones and tablets for use by its customers. U.S. Cellular offers wireless devices that are compatible with fourth generation long term evolution (4G LTE) and third generation (3G) networks. U.S. Cellular offers a range of accessories, such as carrying cases, hands-free devices, batteries, battery chargers, and memory cards to related consumer electronics, such as headphones, speakers and Bluetooth keyboards.
About SK Telecom Co.
SK Telecom Co., Ltd. provides wireless telecommunications in Korea. The Company is engaged in the commercial development and implementation of wireless and fixed-line technologies and services, as well as develop its platforms, including Internet of things (IoT) solutions, lifestyle enhancement and advanced media. It operates through three segments: cellular services, which include wireless voice and data transmission services, sales of wireless devices, IoT solutions platform services and lifestyle enhancement platform services; fixed-line telecommunication services, which include fixed-line telephone services, broadband Internet services, advanced media platform services (including Internet Protocol television (IPTV)) and business communications services, and other businesses, which include its commerce business, its hardware business and other operations. Its brands include SK Telecom, T-Roaming, 7Mobile, B phone, 00700, B tv, Syrup, UO Smart Beam Laser, Astell&Kern and Nate.
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