Analyzing TELUS Corporation (TU) and Cogent Communications Holdings (CCOI)
TELUS Corporation (NYSE: TU) and Cogent Communications Holdings (NASDAQ:CCOI) are both mid-cap integrated telecommunications services – nec companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.
TELUS Corporation pays an annual dividend of $1.58 per share and has a dividend yield of 4.2%. Cogent Communications Holdings pays an annual dividend of $1.84 per share and has a dividend yield of 3.9%. TELUS Corporation pays out 94.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cogent Communications Holdings pays out 511.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TELUS Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings & Valuation
This table compares TELUS Corporation and Cogent Communications Holdings’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|TELUS Corporation||$9.66 billion||2.33||$923.60 million||$1.67||22.74|
|Cogent Communications Holdings||$446.90 million||4.83||$14.92 million||$0.36||130.42|
TELUS Corporation has higher revenue and earnings than Cogent Communications Holdings. TELUS Corporation is trading at a lower price-to-earnings ratio than Cogent Communications Holdings, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for TELUS Corporation and Cogent Communications Holdings, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cogent Communications Holdings||5||6||4||0||1.93|
TELUS Corporation currently has a consensus price target of $47.60, indicating a potential upside of 25.36%. Cogent Communications Holdings has a consensus price target of $42.67, indicating a potential downside of 9.12%. Given TELUS Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe TELUS Corporation is more favorable than Cogent Communications Holdings.
Insider & Institutional Ownership
50.7% of TELUS Corporation shares are held by institutional investors. Comparatively, 92.3% of Cogent Communications Holdings shares are held by institutional investors. 9.5% of Cogent Communications Holdings shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This table compares TELUS Corporation and Cogent Communications Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cogent Communications Holdings||3.37%||-23.86%||2.18%|
Risk and Volatility
TELUS Corporation has a beta of 0.95, indicating that its stock price is 5% less volatile than the S&P 500. Comparatively, Cogent Communications Holdings has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500.
TELUS Corporation beats Cogent Communications Holdings on 12 of the 16 factors compared between the two stocks.
About TELUS Corporation
TELUS Corporation (TELUS) is a telecommunications company. The Company provides a range of telecommunications services and products, including wireless and wireline voice and data. Its data services include Internet protocol (IP), television (TV), hosting, managed information technology and cloud-based services, and certain healthcare solutions. The Company operates through two business segments: Wireless segment and Wireline segment. Its wireless and wireline businesses are primarily operated through TELUS Communications Company (TCC). The Company offers business services, including healthcare, across wireless and wireline are supported through TELUS sales representatives, product specialists, independent dealers and online self-serve applications for small and medium-sized businesses (SMBs). Its business process outsourcing services are supported through sales representatives and client relationship management teams.
About Cogent Communications Holdings
Cogent Communications Holdings, Inc. is a facilities-based provider of Internet access and Internet Protocol (IP), communications services. The Company’s network is specifically designed and optimized to transmit data using IP. The Company delivers its services primarily to small and medium-sized businesses, communications service providers and other bandwidth-intensive organizations in North America, Europe and in Japan. The Company offers on-net services in over 175 metropolitan markets. The Company serves 1,990 on-net buildings. The Company’s on-net service in North America is its Fast Ethernet service, which provides Internet access at 100 megabits per second. It also offers Internet access services at higher speeds of up to ten Gigabits per second. These services are generally used by customers that have businesses, such as Web hosting, that are Internet-based.
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