Critical Analysis: Discovery Communications (DISCA) vs. Entravision Communications Corporation (EVC)
Discovery Communications (NASDAQ: DISCA) and Entravision Communications Corporation (NYSE:EVC) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, valuation, profitability, institutional ownership, dividends and analyst recommendations.
This table compares Discovery Communications and Entravision Communications Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Entravision Communications Corporation||7.03%||10.05%||3.50%|
Earnings & Valuation
This table compares Discovery Communications and Entravision Communications Corporation’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Discovery Communications||$6.59 billion||1.84||$2.48 billion||$1.89||11.24|
|Entravision Communications Corporation||$263.59 million||1.87||$61.52 million||$0.21||25.95|
Discovery Communications has higher revenue and earnings than Entravision Communications Corporation. Discovery Communications is trading at a lower price-to-earnings ratio than Entravision Communications Corporation, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and recommmendations for Discovery Communications and Entravision Communications Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Entravision Communications Corporation||0||2||1||0||2.33|
Discovery Communications currently has a consensus target price of $27.27, suggesting a potential upside of 28.31%. Entravision Communications Corporation has a consensus target price of $7.00, suggesting a potential upside of 28.44%. Given Entravision Communications Corporation’s stronger consensus rating and higher probable upside, analysts clearly believe Entravision Communications Corporation is more favorable than Discovery Communications.
Institutional and Insider Ownership
45.9% of Discovery Communications shares are owned by institutional investors. Comparatively, 58.3% of Entravision Communications Corporation shares are owned by institutional investors. 6.8% of Discovery Communications shares are owned by company insiders. Comparatively, 20.7% of Entravision Communications Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Risk & Volatility
Discovery Communications has a beta of 1.59, meaning that its stock price is 59% more volatile than the S&P 500. Comparatively, Entravision Communications Corporation has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.
Entravision Communications Corporation pays an annual dividend of $0.13 per share and has a dividend yield of 2.4%. Discovery Communications does not pay a dividend. Entravision Communications Corporation pays out 61.9% of its earnings in the form of a dividend. Entravision Communications Corporation has raised its dividend for 3 consecutive years.
Discovery Communications beats Entravision Communications Corporation on 9 of the 17 factors compared between the two stocks.
About Discovery Communications
Discovery Communications, Inc. (Discovery) is a global media company. The Company provides content across multiple distribution platforms, including pay-television (pay-TV), free-to-air (FTA) and broadcast television, Websites, digital distribution arrangements and content licensing agreements. Its segments include U.S. Networks, which consists principally of domestic television networks and digital content services; International Networks, consisting primarily of international television networks and digital content services, and Education and Other, which consists principally of curriculum-based product and service offerings, and production studios. The Company’s portfolio of networks includes television brands, such as Discovery Channel, Animal Planet, ID, Velocity (known as Turbo outside of the United States) and Eurosport. It is also engaged in extending content distribution across various platforms, including brand-aligned Websites, Web-native networks and online streaming.
About Entravision Communications Corporation
Entravision Communications Corporation is a media company. The Company reaches and engages Hispanics in the United States and certain border markets of Mexico across media channels and advertising platforms. The Company operates through three segments: television broadcasting, radio broadcasting and digital media. As of December 31, 2016, the Company owned and operated 54 television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, District of Columbia. It owns and operates Spanish-language radio stations in the United States. As of December 31, 2016, its radio stations consisted of 38 frequency modulation (FM) and 11 amplitude modulation (AM) stations located in Arizona, California, Colorado, Florida, Nevada, New Mexico and Texas. The digital media segment provides digital advertising solutions that allow advertisers to reach online Hispanic audiences throughout the United States and Mexico.
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