Head-To-Head Survey: Telus (TU) & Vodafone Group (VOD)

Telus (NYSE: TU) and Vodafone Group (NASDAQ:VOD) are both large-cap utilities companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, valuation, earnings, risk, analyst recommendations and profitability.

Profitability

This table compares Telus and Vodafone Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Telus 10.65% 18.19% 5.29%
Vodafone Group N/A N/A N/A

Institutional and Insider Ownership

51.1% of Telus shares are owned by institutional investors. Comparatively, 10.9% of Vodafone Group shares are owned by institutional investors. 1.0% of Vodafone Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Telus pays an annual dividend of $1.62 per share and has a dividend yield of 4.6%. Vodafone Group pays an annual dividend of $2.41 per share and has a dividend yield of 9.6%. Telus pays out 79.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Vodafone Group pays out 177.2% 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 increased its dividend for 2 consecutive years.

Valuation and Earnings

This table compares Telus and Vodafone Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Telus $10.26 billion 2.05 $1.13 billion $2.03 17.38
Vodafone Group $54.48 billion 1.23 $2.86 billion $1.36 18.42

Vodafone Group has higher revenue and earnings than Telus. Telus is trading at a lower price-to-earnings ratio than Vodafone Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Telus and Vodafone Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Telus 0 2 7 0 2.78
Vodafone Group 0 1 9 1 3.00

Telus currently has a consensus price target of $46.83, suggesting a potential upside of 32.75%. Vodafone Group has a consensus price target of $31.94, suggesting a potential upside of 27.50%. Given Telus’ higher probable upside, analysts plainly believe Telus is more favorable than Vodafone Group.

Volatility & Risk

Telus has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, Vodafone Group has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500.

Summary

Telus beats Vodafone Group on 10 of the 18 factors compared between the two stocks.

Telus Company Profile

TELUS Corporation, together with its subsidiaries, provides a range of telecommunications products and services in Canada. It operates through Wireless and Wireline segments. The company's telecommunications products and services comprise wireless and wireline voice and data services; data services, including Internet protocol; television services; hosting, managed information technology, and security and cloud-based services; healthcare solutions; business process outsourcing; and security solutions. It has 13 million subscriber connections, including 8.9 million wireless subscribers, 1.7 million high-speed Internet subscribers, 1.3 million wireline residential network access lines, and 1.1 million TELUS TV subscribers. The company was formerly known as TELUS Communications Inc. and changed its name to TELUS Corporation in February 2005. TELUS Corporation was founded in 1993 and is based in Vancouver, Canada.

Vodafone Group Company Profile

Vodafone Group Plc operates as a telecommunications company worldwide. The company offers voice, messaging, and data services across mobile and fixed networks; broadband and TV services; cloud and hosting for storing data and applications in the cloud, as well as Internet protocol-virtual private network services; roaming services; and converged communication services to small businesses and large multinational companies. It also provides M-Pesa, a mobile money service; GigaKombi; GigaTV, an advanced digital TV service; and Vodafone One, an integrated fixed, mobile, and TV service. In addition, the company offers Internet of Things to connect machines to the Internet; international voice, Internet protocol transit, and secure international lines; carrier services for other businesses to transmit information; and smartphones and tablets. The company serves 516 million mobile, 18 million fixed broadband, and 14 million TV customers. It offers its products primarily through approximately 7,000 own-branded and franchised stores, and indirect partners, as well as through online sales and telesales. Vodafone Group Plc has a strategic alliance with SoftBank Corp. for commercial and operational support to multinational enterprise customers operating in Japan. The company was founded in 1984 and is based in Newbury, the United Kingdom.

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