Telephone & Data Systems (NYSE: TDS) and RR Media (NASDAQ:RRM) are both utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, earnings, institutional ownership, profitability and dividends.
This table compares Telephone & Data Systems and RR Media’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Telephone & Data Systems||-2.77%||1.08%||0.55%|
This table compares Telephone & Data Systems and RR Media’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Telephone & Data Systems||$5.10 billion||0.53||$43.00 million||($1.27)||-19.13|
Telephone & Data Systems has higher revenue and earnings than RR Media. Telephone & Data Systems is trading at a lower price-to-earnings ratio than RR Media, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
83.2% of Telephone & Data Systems shares are held by institutional investors. 17.3% of Telephone & Data Systems shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Telephone & Data Systems pays an annual dividend of $0.62 per share and has a dividend yield of 2.6%. RR Media pays an annual dividend of $0.28 per share. Telephone & Data Systems pays out -48.8% of its earnings in the form of a dividend. RR Media pays out 60.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Telephone & Data Systems has raised its dividend for 43 consecutive years. Telephone & Data Systems is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of current recommendations for Telephone & Data Systems and RR Media, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Telephone & Data Systems||0||1||1||0||2.50|
Telephone & Data Systems beats RR Media on 7 of the 12 factors compared between the two stocks.
About Telephone & Data Systems
Telephone and Data Systems, Inc. is a diversified telecommunications company. The Company is engaged in conducting its Wireless operations through its subsidiary, United States Cellular Corporation (U.S. Cellular), as well as providing its wireline services, cable services, and hosted and managed services (HMS), through its subsidiary, TDS Telecommunications Corporation (TDS Telecom). It operates through four business segments: U.S. Cellular, Wireline, Cable, and Hosted and Managed Services. U.S. Cellular provides service to postpaid and prepaid customers. Wireline operations provide retail telecommunications services to both residential and commercial customers. Wireline offers services, including broadband, video, voice and network access services. Cable offers broadband, video and voice services under TDS and BendBroadband brand names. It provides a range of information technology (IT) services, including colocation, and cloud and hosting solutions through its HMS business.
About RR Media
MX1 Ltd, formerly RR Media Ltd, is an Israel-based global media services provider. It is a media globalize company that works with media businesses to transform content into a viewer experience for a global audience. MX1 Ltd offers a range of content management, delivery and digital media services. It distributes more than 1000 television (TV) channels, manages the play out of more than 400 channels and delivers syndicated content to more than 120 subscription Video on Demand (VOD) platforms. The Company has offices worldwide and operates global media centers, enabling customers to reach people around the world. MX1 Ltd is a wholly-owned subsidiary of SES, Euronext Paris and Luxembourg Stock Exchange: SESG.
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