NTT (OTCMKTS:NTTYY – Get Free Report) and Cogent Communications (NASDAQ:CCOI – Get Free Report) are both communication services companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.
Analyst Ratings
This is a summary of current ratings and recommmendations for NTT and Cogent Communications, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NTT | 0 | 1 | 0 | 1 | 3.00 |
| Cogent Communications | 2 | 6 | 3 | 0 | 2.09 |
Cogent Communications has a consensus price target of $19.55, indicating a potential upside of 165.62%. Given Cogent Communications’ higher possible upside, analysts plainly believe Cogent Communications is more favorable than NTT.
Valuation & Earnings
This table compares NTT and Cogent Communications”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NTT | $95.72 billion | 0.96 | $6.84 billion | $2.09 | 13.40 |
| Cogent Communications | $975.77 million | 0.39 | -$182.17 million | ($0.96) | -7.67 |
NTT has higher revenue and earnings than Cogent Communications. Cogent Communications is trading at a lower price-to-earnings ratio than NTT, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
NTT has a beta of 0.07, indicating that its share price is 93% less volatile than the S&P 500. Comparatively, Cogent Communications has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.
Institutional and Insider Ownership
0.1% of NTT shares are owned by institutional investors. Comparatively, 92.4% of Cogent Communications shares are owned by institutional investors. 4.2% of Cogent Communications shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Profitability
This table compares NTT and Cogent Communications’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NTT | 7.17% | 10.45% | 2.41% |
| Cogent Communications | -4.73% | N/A | -4.86% |
Dividends
NTT pays an annual dividend of $0.62 per share and has a dividend yield of 2.2%. Cogent Communications pays an annual dividend of $0.08 per share and has a dividend yield of 1.1%. NTT pays out 29.7% of its earnings in the form of a dividend. Cogent Communications pays out -8.3% 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. Cogent Communications has increased its dividend for 14 consecutive years.
Summary
NTT beats Cogent Communications on 11 of the 18 factors compared between the two stocks.
About NTT
Nippon Telegraph and Telephone Corporation operates as a telecommunications company in Japan and internationally. It operates through Integrated ICT Business, Regional Communications Business, Global Solutions Business, and Others segments. The Integrated ICT Business segment offers mobile phone, domestic inter-prefectural communications, international communications, solutions, and system development and related services. The Regional Communications Business segment provides intra-prefectural communications and related ancillary services. The Global Solutions Business segment offers consulting, system and software development, network system, cloud, global data center, and related services. The Others segment engages in the real estate, energy, and other businesses. The company was founded in 1952 and is headquartered in Tokyo, Japan.
About Cogent Communications
Cogent Communications Holdings, Inc., through its subsidiaries, provides high-speed Internet access, private network, and data center colocation space services in North America, Europe, Oceania, South America, and Africa. The company offers on-net Internet access and private network services to law firms, financial services firms, and advertising and marketing firms, as well as heath care providers, educational institutions and other professional services businesses, other Internet service providers, telephone companies, cable television companies, web hosting companies, media service providers, mobile phone operators, content delivery network companies, and commercial content and application service providers. It also provides Internet access and private network services to customers that are not located in buildings directly connected to its network; and on-net services to customers located in buildings that are physically connected to its network. In addition, the company offers off-net services to corporate customers using other carriers' circuits to provide the last mile portion of the link from the customers' premises to the network. Further, it operates data centers that allow its customers to collocate their equipment and access the network. It serves primarily to small and medium-sized businesses, communications service providers, and other bandwidth-intensive organizations. Cogent Communications Holdings, Inc. was founded in 1999 and is headquartered in Washington, the District of Columbia.
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