Altice USA (NASDAQ: ATUS) and CenturyLink (NYSE:CTL) are both large-cap telecommunications services companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Institutional and Insider Ownership

83.0% of CenturyLink shares are owned by institutional investors. 0.6% of CenturyLink shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Altice USA and CenturyLink, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Altice USA 0 5 7 0 2.58
CenturyLink 3 6 4 0 2.08

Altice USA currently has a consensus price target of $36.50, indicating a potential upside of 18.97%. CenturyLink has a consensus price target of $25.55, indicating a potential upside of 26.28%. Given CenturyLink’s higher possible upside, analysts clearly believe CenturyLink is more favorable than Altice USA.

Profitability

This table compares Altice USA and CenturyLink’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Altice USA -20.39% -63.90% -5.28%
CenturyLink 2.20% 8.43% 2.36%

Dividends

CenturyLink pays an annual dividend of $2.16 per share and has a dividend yield of 10.7%. Altice USA 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.

Earnings and Valuation

This table compares Altice USA and CenturyLink’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Altice USA $9.20 billion 2.46 $3.69 billion N/A N/A
CenturyLink $16.97 billion 0.66 $6.06 billion $0.69 29.32

CenturyLink has higher revenue and earnings than Altice USA.

Summary

CenturyLink beats Altice USA on 9 of the 13 factors compared between the two stocks.

About Altice USA

Altice USA, Inc. is engaged in providing broadband communications and video services in the United States. The Company’s segments include Cablevision and Cequel. Cablevision provides broadband, pay television and telephony services to residential and business customers in and around the New York metropolitan area. Cequel provides broadband, pay television and telephony services to residential and business customers in the south-central United States. It also provides services through ten states of Texas, West Virginia, Louisiana, Arkansas, North Carolina, Oklahoma, Arizona, California, Missouri and Ohio. The Company also provides Wi-Fi hotspot access content and advertising services. Broadband provides services, such as video streaming, content downloading for time-shifted video consumption and other applications delivered over OTT platforms. Pay Television provides services through cable network. Video services delivered over DSL networks.

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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