Critical Analysis: KT Corporation (KT) and Frontier Communications Corporation (FTR)
Frontier Communications Corporation (NASDAQ: FTR) and KT Corporation (NYSE:KT) are both utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.
This table compares Frontier Communications Corporation and KT Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Frontier Communications Corporation||-9.35%||-1.28%||-0.19%|
Earnings and Valuation
This table compares Frontier Communications Corporation and KT Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Frontier Communications Corporation||$9.59 billion||0.09||$3.74 billion||($14.42)||-0.79|
|KT Corporation||$20.60 billion||0.35||$4.05 billion||N/A||N/A|
KT Corporation has higher revenue and earnings than Frontier Communications Corporation.
This is a breakdown of current recommendations and price targets for Frontier Communications Corporation and KT Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Frontier Communications Corporation||2||9||2||0||2.00|
Frontier Communications Corporation presently has a consensus price target of $8.49, suggesting a potential downside of 25.91%. Given Frontier Communications Corporation’s higher possible upside, analysts clearly believe Frontier Communications Corporation is more favorable than KT Corporation.
Institutional & Insider Ownership
24.1% of KT Corporation shares are owned by institutional investors. 0.9% of Frontier Communications Corporation shares are owned by insiders. Comparatively, 1.0% of KT Corporation shares are owned by 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.
Risk and Volatility
Frontier Communications Corporation has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, KT Corporation has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500.
Frontier Communications Corporation pays an annual dividend of $2.40 per share and has a dividend yield of 20.9%. KT Corporation does not pay a dividend. Frontier Communications Corporation pays out -16.6% of its earnings in the form of a dividend.
KT Corporation beats Frontier Communications Corporation on 9 of the 14 factors compared between the two stocks.
About Frontier Communications Corporation
Frontier Communications Corporation (Frontier) is a provider of communications services in the United States. The Company offers a portfolio of communications services for residential and business customers. Its products and services include data and Internet services, video services, voice services, access services and customer premise equipment (CPE). The Company offers a range of broadband services. The principal residential service it provides is broadband Internet service. Its commercial services include Ethernet, Dedicated Internet, Multiprotocol Label Switching (MPLS), Time Division Multiplexing (TDM) data transport services and optical transport services. It also offers wireless broadband services (using unlicensed spectrum) in various markets utilizing networks that it owns or operates. In addition, the Company offers its Frontier Secure suite of products, including computer security, cloud backup and sharing, identity protection and equipment insurance.
About KT Corporation
KT Corporation is a telecommunications service provider. The Company’s segments include the Customer/Marketing Group, the Finance Business Group and the Others Group. The Customer/Marketing Group segment is engaged in providing various telecommunication services to individual/home/corporate customers and the convergence business. The Finance Business Group segment is engaged in providing various financial services, such as credit card. The Others Group segment includes security services, satellite service, information technology and network services, and satellite television services, as well as global business services, which provide global network services to multinational or domestic corporate customers and telecommunications companies. The Company’s principal services include mobile voice and data telecommunications services; fixed-line services; credit card processing and other financial services, and various other services.
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