Rogers Communication (NYSE: RCI) and ORBCOMM (NASDAQ:ORBC) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, risk, analyst recommendations, earnings and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Rogers Communication and ORBCOMM, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rogers Communication 0 5 3 0 2.38
ORBCOMM 0 0 6 0 3.00

Rogers Communication currently has a consensus target price of $57.00, indicating a potential upside of 8.63%. ORBCOMM has a consensus target price of $13.30, indicating a potential upside of 31.94%. Given ORBCOMM’s stronger consensus rating and higher probable upside, analysts plainly believe ORBCOMM is more favorable than Rogers Communication.

Earnings and Valuation

This table compares Rogers Communication and ORBCOMM’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Rogers Communication $11.13 billion 2.43 $4.11 billion $1.48 35.45
ORBCOMM $202.00 million 3.67 $36.94 million ($0.45) -22.40

Rogers Communication has higher revenue and earnings than ORBCOMM. ORBCOMM is trading at a lower price-to-earnings ratio than Rogers Communication, indicating that it is currently the more affordable of the two stocks.

Dividends

Rogers Communication pays an annual dividend of $1.51 per share and has a dividend yield of 2.9%. ORBCOMM does not pay a dividend. Rogers Communication pays out 102.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Rogers Communication and ORBCOMM’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rogers Communication 7.42% 28.90% 5.64%
ORBCOMM -15.52% -6.16% -3.25%

Volatility and Risk

Rogers Communication has a beta of 0.86, meaning that its stock price is 14% less volatile than the S&P 500. Comparatively, ORBCOMM has a beta of 0.92, meaning that its stock price is 8% less volatile than the S&P 500.

Institutional and Insider Ownership

47.5% of Rogers Communication shares are held by institutional investors. Comparatively, 77.2% of ORBCOMM shares are held by institutional investors. 9.5% of ORBCOMM shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

ORBCOMM beats Rogers Communication on 8 of the 15 factors compared between the two stocks.

About Rogers Communication

Rogers Communications Inc. is a communications and media company. The Company provides wireless communications services, and cable television, Internet, information technology (IT) and telephony services to consumers and businesses. Its segments include Wireless, Cable, Business Solutions and Media. The Wireless segment is engaged in wireless telecommunications operations for Canadian consumers and businesses. The Cable segment include cable telecommunications operations, including Internet, television and telephony (phone) services for Canadian consumers and businesses. The Business Solutions segment is engaged in network connectivity through its fiber network and data center assets to support a range of voice, data, networking, hosting, and cloud-based services for the enterprise, public sector and carrier wholesale markets. The Media segment has a portfolio of media properties, including sports media and entertainment, multi-platform shopping, digital media and publishing.

About ORBCOMM

ORBCOMM Inc. is a provider of Internet of Things (IoT) solutions, including network connectivity, devices, device management and Web reporting applications. The Company’s IoT products and services are designed to track, monitor and manage security for a range of assets, such as trailers, trucks, rail cars, sea containers, generators, fluid tanks, marine vessels, diesel or electric powered generators (gensets), oil and gas wells, pipeline monitoring equipment, irrigation control systems, and utility meters, in industries for transportation and supply chain, heavy equipment, fixed asset monitoring, maritime and government. It also provides Automatic Identification System (AIS) data services to assist in vessel navigation and to manage maritime safety for government and commercial customers across the world. It provides its services using various network platforms, including its own constellation of low-Earth orbit (LEO) satellites.

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