Telecom Italia S.P.A. (NYSE: TI) and CenturyLink (NYSE:CTL) are both large-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, risk, valuation, analyst recommendations, institutional ownership and dividends.

Dividends

CenturyLink pays an annual dividend of $2.16 per share and has a dividend yield of 11.4%. Telecom Italia S.P.A. does not pay a dividend. CenturyLink pays out 313.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a summary of current recommendations for Telecom Italia S.P.A. and CenturyLink, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Telecom Italia S.P.A. 0 4 2 0 2.33
CenturyLink 3 6 4 0 2.08

CenturyLink has a consensus price target of $25.55, suggesting a potential upside of 34.59%. Given CenturyLink’s higher possible upside, analysts clearly believe CenturyLink is more favorable than Telecom Italia S.P.A..

Institutional and Insider Ownership

0.8% of Telecom Italia S.P.A. shares are owned by institutional investors. Comparatively, 83.0% of CenturyLink shares are owned by institutional investors. 0.6% of CenturyLink shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Telecom Italia S.P.A. has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500. Comparatively, CenturyLink has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Profitability

This table compares Telecom Italia S.P.A. and CenturyLink’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Telecom Italia S.P.A. N/A N/A N/A
CenturyLink 2.20% 8.43% 2.36%

Earnings and Valuation

This table compares Telecom Italia S.P.A. and CenturyLink’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Telecom Italia S.P.A. $23.57 billion 0.84 $10.16 billion N/A N/A
CenturyLink $16.97 billion 0.61 $6.06 billion $0.69 27.51

Telecom Italia S.P.A. has higher revenue and earnings than CenturyLink.

Summary

CenturyLink beats Telecom Italia S.P.A. on 8 of the 14 factors compared between the two stocks.

About Telecom Italia S.P.A.

Telecom Italia S.p.A. (Telecom Italia) operates fixed voice and data infrastructure in Italy, and provides mobile network platforms. The Company focuses on various areas of digital services, including Enriched Communication, Trusted Digital Life, Business Life, Indoor Life, Mobile Open Life and Digital Entertainment. Its segments include Consumer, Business, National Wholesale and Other. It is engaged in developing various projects in areas, including Smart Green, Social Reading, Solutions for good schooling, Digital tourism 2.0, Smart Home, FriendTV and Big Data. Smart Green is the assessment of projects connected with the environment and potential partnerships with the local government offices for the monitoring of air in public offices and urban areas, using networks of sensors connected to the Company’s Cloud. The Company is involved, either alone or in partnership with external partners, in devising and developing healthcare services at national, regional and local level.

About CenturyLink

CenturyLink, Inc. is an integrated communications company. The Company is engaged in providing an array of communications services to its residential and business customers. Its segments include business, which provides strategic, legacy and data integration products and services to small, medium and enterprise business, wholesale and governmental customers, including other communication providers, and consumer, which provides strategic and legacy products and services to residential customers. Its communications services include local and long-distance voice, broadband, Multi-Protocol Label Switching (MPLS), private line (including special access), Ethernet, colocation, hosting (including cloud hosting and managed hosting), data integration, video, network, public access, Voice over Internet Protocol (VoIP), information technology and other ancillary services. As of December 31, 2016, it served approximately 5.9 million broadband subscribers and 325,000 Prism TV subscribers.

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