Analyzing Millicom International Cellular (TIGO) & VEON (VEON)

Millicom International Cellular (NASDAQ:TIGO) and VEON (NASDAQ:VEON) are both mid-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Millicom International Cellular and VEON, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Millicom International Cellular 0 0 0 0 N/A
VEON 0 4 3 0 2.43

VEON has a consensus target price of $3.40, suggesting a potential upside of 32.81%. Given VEON’s higher possible upside, analysts clearly believe VEON is more favorable than Millicom International Cellular.

Institutional & Insider Ownership

1.7% of Millicom International Cellular shares are owned by institutional investors. Comparatively, 15.4% of VEON shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Millicom International Cellular and VEON’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Millicom International Cellular -0.18% 0.87% 0.30%
VEON -0.70% -34.57% -6.50%

Risk and Volatility

Millicom International Cellular has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500. Comparatively, VEON has a beta of 1.83, suggesting that its share price is 83% more volatile than the S&P 500.

Dividends

Millicom International Cellular pays an annual dividend of $2.64 per share and has a dividend yield of 4.3%. VEON pays an annual dividend of $0.19 per share and has a dividend yield of 7.4%. Millicom International Cellular pays out 910.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. VEON pays out 316.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. VEON is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Millicom International Cellular and VEON’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Millicom International Cellular $4.07 billion 1.50 -$10.00 million $0.29 209.55
VEON $9.47 billion 0.47 -$483.00 million $0.06 42.67

Millicom International Cellular has higher earnings, but lower revenue than VEON. VEON is trading at a lower price-to-earnings ratio than Millicom International Cellular, indicating that it is currently the more affordable of the two stocks.

About Millicom International Cellular

Millicom International Cellular SA engages in the provision of cable and mobile services in Latin America and Africa. It operates through the Latin America and Africa segments. The company was founded on December 14, 1990 and is headquartered in Luxembourg.

About VEON

VEON Ltd., through its subsidiaries, provides mobile and fixed-line telecommunications services. It offers voice and data telecommunication services through a range of traditional and broadband mobile and fixed line technologies. The company provides mobile telecommunications services under contract and prepaid plans for corporate and consumer segments; value added services, including short messages, multimedia messages, caller number identification, call waiting, data transmission, mobile Internet, downloadable content, mobile finance, machine-to-machine, and other services; national and international roaming services; and mobile bundles. It also offers fixed-line telecommunication services, such as voice, data, and Internet services; and PSTN-fixed and IP telephony, data transmission and network access, domestic and international voice termination, IPLC, and TCP/IP international transit services for corporations, operators, and consumers, as well as sells equipment and accessories. The company provides its services under the Beeline, Kyivstar, banglalink, Jazz, and Djezzy brands in Russia, Pakistan, Algeria, Uzbekistan, Ukraine, Bangladesh, Kazakhstan, Kyrgyzstan, Tajikistan, Armenia, and Georgia. As of March 15, 2018, it served approximately 240 million customers. The company was formerly known as VimpelCom Ltd. and changed its name to VEON Ltd. in March 2017. VEON Ltd. was founded in 1992 and is headquartered in Amsterdam, the Netherlands.

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