Hemisphere Media Group (NASDAQ: HMTV) and Time Warner (NYSE:TWX) are both consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, earnings, dividends and risk.

Profitability

This table compares Hemisphere Media Group and Time Warner’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hemisphere Media Group -19.72% -3.97% -1.98%
Time Warner 17.33% 19.99% 8.17%

Risk & Volatility

Hemisphere Media Group has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500. Comparatively, Time Warner has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500.

Dividends

Time Warner pays an annual dividend of $1.61 per share and has a dividend yield of 1.6%. Hemisphere Media Group does not pay a dividend. Time Warner pays out 25.1% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current ratings and price targets for Hemisphere Media Group and Time Warner, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hemisphere Media Group 0 0 1 0 3.00
Time Warner 0 17 4 0 2.19

Hemisphere Media Group currently has a consensus price target of $15.00, indicating a potential upside of 17.65%. Time Warner has a consensus price target of $103.22, indicating a potential upside of 4.50%. Given Hemisphere Media Group’s stronger consensus rating and higher probable upside, research analysts plainly believe Hemisphere Media Group is more favorable than Time Warner.

Institutional & Insider Ownership

32.0% of Hemisphere Media Group shares are held by institutional investors. Comparatively, 78.9% of Time Warner shares are held by institutional investors. 51.9% of Hemisphere Media Group shares are held by company insiders. Comparatively, 0.2% of Time Warner shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Hemisphere Media Group and Time Warner’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hemisphere Media Group $124.46 million 4.04 -$13.43 million N/A N/A
Time Warner $31.27 billion 2.47 $5.25 billion $6.42 15.38

Time Warner has higher revenue and earnings than Hemisphere Media Group.

Summary

Time Warner beats Hemisphere Media Group on 9 of the 14 factors compared between the two stocks.

About Hemisphere Media Group

Hemisphere Media Group, Inc. owns and operates Spanish-language cable television broadcasting networks and digital content platform in the United States and internationally. It operates Cinelatino, a cable movie network with approximately 20 million subscribers in the United States, Latin America, and Canada; WAPA, a broadcast television network and television content producer; and WAPA.TV, a broadband news and entertainment Website, as well as distributes WAPA2 Deportes, a sports television network in Puerto Rico. The company also operates WAPA America, a cable television network that serves 4.4 million subscribers in the United States; and Pasiones, a cable television network that offers telenovelas and serialized dramas to 4.5 million subscribers in the United States and 14.8 million subscribers in Latin America. In addition, it operates Centroamerica TV, a cable television network that offers news and entertainment, and soccer programming to 4.1 million subscribers in Central America; and Television Dominicana, a cable television network that provides news and entertainment to approximately 1.9 million subscribers in the Dominican Republic. Further, the company operates Canal 1, a television network in Colombia; and Pantaya, a cross-platform Spanish-language digital subscription service that offers Spanish-language films. The company was founded in 2013 and is headquartered in Coral Gables, Florida.

About Time Warner

Time Warner Inc. operates as a media and entertainment company in the United States and internationally. It operates through three segments: Turner, Home Box Office, and Warner Bros. The Turner segment creates and programs branded news, entertainment, sports, and kids multi-platform content for consumers. It operates approximately 175 channels in 200 countries and territories. The Turner segment's networks and related businesses and brands include TNT, TBS, Adult Swim, truTV, Turner Classic Movies, Turner Sports, Bleacher Report, Cartoon Network, Boomerang, CNN, HLN, and iStreamPlanet; and digital properties comprise tntdrama.com, TBS.com, adultswim.com, and cartoonnetwork.com, as well as NBA.com, the NBA League Pass property, NCAA.com, the NCAA March Madness Live app, and PGA.com. It also licenses its original programming, and its brands and characters for consumer products and other business ventures. The Home Box Office segment provides premium pay and basic tier television, and video content services comprising HBO and Cinemax; operates HBO NOW, a video content service; and sells original programming through physical and digital formats, as well as licenses original programming through international television networks and video content services. As of December 31, 2017, this segment had 54 million domestic subscribers. The Warner Bros. segment produces, distributes, and licenses television programming and feature films; distributes digital and physical home entertainment products; and produces and distributes games, as well as licenses consumer products and brands. Time Warner Inc. serves cable system operators, satellite service distributors, telephone companies, and virtual multichannel video programming distributors, as well as digital distributors. The company was formerly known as AOL Time Warner, Inc. and changed its name to Time Warner Inc. in 2003. Time Warner Inc. was founded in 1985 and is headquartered in New York, New York.

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