Analyzing TELE2 AB/ADR (TLTZY) & Frontier Communications (FTR)

TELE2 AB/ADR (OTCMKTS:TLTZY) and Frontier Communications (NASDAQ:FTR) are both utilities companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for TELE2 AB/ADR and Frontier Communications, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TELE2 AB/ADR 0 0 0 0 N/A
Frontier Communications 5 7 0 0 1.58

Frontier Communications has a consensus price target of $7.17, indicating a potential upside of 33.52%. Given Frontier Communications’ higher possible upside, analysts clearly believe Frontier Communications is more favorable than TELE2 AB/ADR.

Volatility and Risk

TELE2 AB/ADR has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Frontier Communications has a beta of 0.57, meaning that its share price is 43% less volatile than the S&P 500.

Dividends

TELE2 AB/ADR pays an annual dividend of $0.16 per share and has a dividend yield of 2.6%. Frontier Communications pays an annual dividend of $0.60 per share and has a dividend yield of 11.2%. TELE2 AB/ADR pays out 55.2% of its earnings in the form of a dividend. Frontier Communications pays out -15.8% 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. Frontier Communications is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares TELE2 AB/ADR and Frontier Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TELE2 AB/ADR 1.52% 15.86% 6.68%
Frontier Communications -12.06% -2.48% -0.26%

Institutional and Insider Ownership

62.7% of Frontier Communications shares are owned by institutional investors. 2.3% of Frontier Communications shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares TELE2 AB/ADR and Frontier Communications’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TELE2 AB/ADR $2.94 billion 2.10 $49.85 million $0.29 21.17
Frontier Communications $9.13 billion 0.06 -$1.80 billion ($3.79) -1.42

TELE2 AB/ADR has higher earnings, but lower revenue than Frontier Communications. Frontier Communications is trading at a lower price-to-earnings ratio than TELE2 AB/ADR, indicating that it is currently the more affordable of the two stocks.

Summary

TELE2 AB/ADR beats Frontier Communications on 8 of the 14 factors compared between the two stocks.

TELE2 AB/ADR Company Profile

Tele2 AB (publ), a telecom operator, provides telecommunication services for residential and business customers. The company offers mobile voice telephony, handset data, messaging, and value-added services, such as handset insurance, antivirus, and content services; mobile broadband services; and fixed voice and broadband, TV, and fixed and mobile telephony services. It also provides business-to-business telecommunication services, such as secure and encrypted connections, company-specific mobile network access points, etc.; cloud services comprising voice switching, data center services, business productivity solutions, etc.; and data connectivity, Ethernet connectivity, VPN services, and international IP connectivity services, as well as IoT solutions. As of March 28, 2018, the company served approximately 17 million customers in 8 countries. It provides services in Sweden, Lithuania, Latvia, Estonia, Kazakhstan, Croatia, Germany, and internationally. Tele2 AB (publ) was founded in 1990 and is headquartered in Stockholm, Sweden.

Frontier Communications Company Profile

Frontier Communications Corporation provides communications services to consumer, commercial, and wholesale customers in the United States. It offers broadband, video, voice, and other services and products through a combination of fiber and copper based networks to consumer customers. The company also provides broadband, Ethernet, traditional circuit-based, and voice services; and software defined wide area network, multiprotocol label switching, and time division multiplexing data transport and optical transport services to small, medium, and large enterprises, as well as advanced hardware and network solutions and services, and customer premise equipment. In addition, it offers 24/7 technical support; wireless broadband services in selected markets; satellite TV video services; voice services, including data-based VoIP, and long distance and voice messaging services; and a package of communications services. Further, the company provides a range of access services that allow other carriers to use facilities to originate and terminate their local and long distance voice traffic. As of December 31, 2017, it served approximately 4.9 million customers and 3.9 million broadband subscribers in 29 states. The company was formerly known as Citizens Communications Company and changed its name to Frontier Communications Corporation in July 2008. Frontier Communications Corporation was founded in 1927 and is based in Norwalk, Connecticut.

Receive News & Ratings for TELE2 AB/ADR Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for TELE2 AB/ADR and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply