Optimum Communications (NYSE:OPTU – Get Free Report) and Advantage Solutions (NASDAQ:ADV – Get Free Report) are both small-cap communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.
Analyst Ratings
This is a summary of current ratings and recommmendations for Optimum Communications and Advantage Solutions, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Optimum Communications | 4 | 5 | 0 | 0 | 1.56 |
| Advantage Solutions | 2 | 1 | 1 | 0 | 1.75 |
Optimum Communications currently has a consensus price target of $0.92, indicating a potential downside of 3.35%. Advantage Solutions has a consensus price target of $42.00, indicating a potential upside of 58.08%. Given Advantage Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Advantage Solutions is more favorable than Optimum Communications.
Institutional & Insider Ownership
Risk & Volatility
Optimum Communications has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500. Comparatively, Advantage Solutions has a beta of 2.16, meaning that its stock price is 116% more volatile than the S&P 500.
Valuation & Earnings
This table compares Optimum Communications and Advantage Solutions”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Optimum Communications | $8.59 billion | 0.03 | -$1.87 billion | ($10.39) | -0.09 |
| Advantage Solutions | $3.54 billion | 0.10 | -$227.74 million | ($21.34) | -1.25 |
Advantage Solutions has lower revenue, but higher earnings than Optimum Communications. Advantage Solutions is trading at a lower price-to-earnings ratio than Optimum Communications, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Optimum Communications and Advantage Solutions’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Optimum Communications | -58.15% | N/A | -0.70% |
| Advantage Solutions | -7.65% | -48.15% | -9.47% |
About Optimum Communications
Altice USA, Inc., together with its subsidiaries, provides broadband communications and video services in the United States, Canada, Puerto Rico, and the Virgin Islands. It offers broadband, video, telephony, and mobile services to approximately five million residential and business customers. The company’s video services include delivery of broadcast stations and cable networks; over the top services; video-on-demand, high-definition channels, digital video recorder, and pay-per-view services; and platforms for video programming through mobile applications. It also provides voice over Internet protocol telephone services; and mobile services, such as data, talk, and text. In addition, the company offers Ethernet, data transport, IP-based virtual private networks, Internet access, and telephony services; hosted telephony services, managed Wi-Fi, managed desktop and server backup, and collaboration services comprising audio and web conferencing; fiber-to-the-tower services to wireless carriers; data services consisting of wide area networking and dedicated data access, as well as wireless mesh networks; and enterprise class telephone services that include traditional multi-line phone service. Further, it provides business e-mail, hosted private branch exchange, web space storage, and network security monitoring; and international calling and toll free numbers. Additionally, the company offers audience-based and IP-authenticated cross-screen advertising solutions; and television and digital advertising services, as well as operates news channels under the News 12 Networks, Cheddar, and i24NEWS names. It also provides broadband communications and video services under the Optimum and Suddenlink brands. The company was incorporated in 2015 and is headquartered in Long Island City, New York. Altice USA, Inc. is a subsidiary of Next Alt. S.a.r.l.
About Advantage Solutions
Advantage Solutions Inc. provides business solutions to consumer goods manufacturers and retailers in North America and internationally. It operates in two segments, Sales and Marketing. The Sales segment offers brand-centric services, such as headquarter relationship management; analytics, insights, and intelligence; and brand-centric merchandising services. This segment also provides retailer-centric services comprising retailer-centric merchandising and in-store media services. The Marketing segment offers brand-centric services, including shopper and consumer marketing, and brand experiential services; retailer-centric services, such as retail experiential and private label services; and digital marketing, and digital media and advertising services. The company was formerly known as Karman Holding Corp. and changed its name to Advantage Solutions Inc. in March 2016. The company was founded in 1987 and is headquartered in Irvine, California.
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