Analyzing Black Box Corporation (BBOX) & Frontier Communications Corporation (FTR)

Frontier Communications Corporation (NASDAQ: FTR) and Black Box Corporation (NASDAQ:BBOX) are both small-cap utilities companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Dividends

Frontier Communications Corporation pays an annual dividend of $2.40 per share and has a dividend yield of 16.1%. Black Box Corporation pays an annual dividend of $0.48 per share and has a dividend yield of 11.9%. Frontier Communications Corporation pays out -16.6% of its earnings in the form of a dividend. Black Box Corporation pays out -44.4% 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.

Risk & Volatility

Frontier Communications Corporation has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500. Comparatively, Black Box Corporation has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500.

Profitability

This table compares Frontier Communications Corporation and Black Box Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Frontier Communications Corporation -9.35% -1.28% -0.19%
Black Box Corporation -1.97% 3.00% 0.98%

Earnings and Valuation

This table compares Frontier Communications Corporation and Black Box Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Frontier Communications Corporation $9.59 billion 0.12 $3.74 billion ($14.42) -1.03
Black Box Corporation $855.73 million 0.07 $31.73 million ($1.08) -3.75

Frontier Communications Corporation has higher revenue and earnings than Black Box Corporation. Black Box Corporation is trading at a lower price-to-earnings ratio than Frontier Communications Corporation, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and target prices for Frontier Communications Corporation and Black Box Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Frontier Communications Corporation 2 9 2 0 2.00
Black Box Corporation 0 1 0 0 2.00

Frontier Communications Corporation currently has a consensus price target of $6.01, suggesting a potential downside of 59.66%. Black Box Corporation has a consensus price target of $10.00, suggesting a potential upside of 146.91%. Given Black Box Corporation’s higher probable upside, analysts plainly believe Black Box Corporation is more favorable than Frontier Communications Corporation.

Insider & Institutional Ownership

93.5% of Black Box Corporation shares are owned by institutional investors. 0.9% of Frontier Communications Corporation shares are owned by insiders. Comparatively, 3.7% of Black Box Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Black Box Corporation beats Frontier Communications Corporation on 8 of the 14 factors compared between the two stocks.

About Frontier Communications Corporation

Frontier Communications Corporation (Frontier) is a provider of communications services in the United States. The Company offers a portfolio of communications services for residential and business customers. Its products and services include data and Internet services, video services, voice services, access services and customer premise equipment (CPE). The Company offers a range of broadband services. The principal residential service it provides is broadband Internet service. Its commercial services include Ethernet, Dedicated Internet, Multiprotocol Label Switching (MPLS), Time Division Multiplexing (TDM) data transport services and optical transport services. It also offers wireless broadband services (using unlicensed spectrum) in various markets utilizing networks that it owns or operates. In addition, the Company offers its Frontier Secure suite of products, including computer security, cloud backup and sharing, identity protection and equipment insurance.

About Black Box Corporation

Black Box Corporation is a technology solutions provider. The Company is engaged in designing, building, managing and securing the information technology (IT) infrastructure. Offerings under the Company’s Products platform include IT infrastructure, specialty networking, multimedia and keyboard/video/mouse (KVM) switching. Offerings under its Services platform include unified communications, data infrastructure and managed services. It conducts business globally and manages its business on a geographic-service type basis consisting of four segments: North America Products, North America Services, International Products and International Services. The offerings of its Products platform are distributed through value-added resellers, direct marketing manufacturers, mass merchandisers, Web retailers and others. The offerings of its Services platform are distributed through value-added resellers, manufacturers and large system integrators, among others.

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