Otelco (NASDAQ: OTT) and Alaska Communications Systems Group (NASDAQ:ALSK) are both small-cap telecommunications services companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, valuation, profitability and risk.
Volatility and Risk
Otelco has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500. Comparatively, Alaska Communications Systems Group has a beta of -0.17, suggesting that its stock price is 117% less volatile than the S&P 500.
This table compares Otelco and Alaska Communications Systems Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alaska Communications Systems Group||-0.66%||-0.03%||-0.01%|
Earnings & Valuation
This table compares Otelco and Alaska Communications Systems Group’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Alaska Communications Systems Group||$226.87 million||0.47||$2.38 million||($0.02)||-102.50|
Alaska Communications Systems Group has higher revenue and earnings than Otelco. Alaska Communications Systems Group is trading at a lower price-to-earnings ratio than Otelco, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
44.6% of Alaska Communications Systems Group shares are held by institutional investors. 6.5% of Alaska Communications Systems Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This is a breakdown of current recommendations and price targets for Otelco and Alaska Communications Systems Group, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alaska Communications Systems Group||0||0||0||0||N/A|
Otelco Inc. provides a range of telecommunications services on a retail and wholesale basis. These services include local and long distance calling; network access to and from its customers; data transport; digital high-speed and dial-up Internet access; cable, satellite and Internet protocol television; wireless, and other telephone related services. The principal markets for these services are residential and business customers residing in and adjacent to the exchanges the Company serves in Alabama, Massachusetts, Maine, Missouri, Vermont and West Virginia. In addition, the Company serves business customers throughout Maine and New Hampshire and provides dial-up Internet service throughout the states of Maine and Missouri. In January 2014, the Company acquired Reliable Networks, a provider of cloud hosting and managed services for companies who rely on mission-critical applications.
About Alaska Communications Systems Group
Alaska Communications Systems Group, Inc. is a fiber broadband and managed information technology (IT) services provider. The Company is focused primarily on business and wholesale customers in and out of Alaska. The Company also provides telecommunication services to consumers across Alaska. The Company’s facilities-based communications network extends across Alaska and connects to the contiguous states through its undersea fiber optic cable systems and its usage rights on an undersea system. It serves customers in various areas, such as Business and Wholesale (broadband, voice and managed IT services); Consumer (broadband and voice services), and Other Services (including carrier termination, equipment sales, access services and support services receiving federal support funding). It provides voice and broadband services to residential customers. It provides voice and broadband origination and termination services to inter and intrastate carriers serving its retail customers.
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