TELUS (NYSE: TU) and Telefonica Brasil (NYSE:VIV) are both large-cap telecommunications services companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, dividends and analyst recommendations.
TELUS pays an annual dividend of $1.59 per share and has a dividend yield of 4.2%. Telefonica Brasil pays an annual dividend of $0.95 per share and has a dividend yield of 6.2%. TELUS pays out 93.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Telefonica Brasil pays out 120.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TELUS has raised its dividend for 2 consecutive years and Telefonica Brasil has raised its dividend for 5 consecutive years. Telefonica Brasil is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares TELUS and Telefonica Brasil’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|TELUS||$9.66 billion||2.34||$923.60 million||$1.71||22.23|
|Telefonica Brasil||$12.25 billion||2.13||$1.17 billion||$0.79||19.52|
Telefonica Brasil has higher revenue and earnings than TELUS. Telefonica Brasil is trading at a lower price-to-earnings ratio than TELUS, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations for TELUS and Telefonica Brasil, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
TELUS presently has a consensus price target of $46.17, indicating a potential upside of 21.43%. Telefonica Brasil has a consensus price target of $16.03, indicating a potential upside of 3.98%. Given TELUS’s stronger consensus rating and higher possible upside, research analysts plainly believe TELUS is more favorable than Telefonica Brasil.
This table compares TELUS and Telefonica Brasil’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
51.8% of TELUS shares are owned by institutional investors. Comparatively, 9.3% of Telefonica Brasil shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Volatility & Risk
TELUS has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, Telefonica Brasil has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.
TELUS beats Telefonica Brasil on 10 of the 16 factors compared between the two stocks.
TELUS Corporation (TELUS) is a telecommunications company. The Company provides a range of telecommunications services and products, including wireless and wireline voice and data. Its data services include Internet protocol (IP), television (TV), hosting, managed information technology and cloud-based services, and certain healthcare solutions. The Company operates through two business segments: Wireless segment and Wireline segment. Its wireless and wireline businesses are primarily operated through TELUS Communications Company (TCC). The Company offers business services, including healthcare, across wireless and wireline are supported through TELUS sales representatives, product specialists, independent dealers and online self-serve applications for small and medium-sized businesses (SMBs). Its business process outsourcing services are supported through sales representatives and client relationship management teams.
About Telefonica Brasil
Telefonica Brasil S.A. is a mobile telecommunications company in Brazil offering postpaid mobile services. The Company also operates as a fixed telecommunications company in the state of Sao Paulo. The Company markets its mobile services under its Vivo brand. It offers its clients a portfolio of products, including mobile and fixed voice, mobile data, fixed broadband, ultra-fast broadband, Pay television, information technology and digital services. Its operations consist of local and long distance fixed telephone services; mobile services, including value-added services; data services, including broadband services and mobile data services; Pay television services through direct to home (DTH), Internet protocol television (IPTV) and cable; network services, such as rental of facilities, as well as other services; wholesale services, including interconnection; digital services; services designed specifically for corporate customers, and the sale of wireless devices and accessories.
What are top analysts saying about TELUS? - Enter your email address in the form below to receive our free daily email newsletter that contains the latest headlines and analysts' recommendations for for TELUS and related companies.