Contrasting Rogers Communication (NYSE:RCI) & Telefonica Brasil (NYSE:VIV)

Rogers Communication (NYSE:RCI) and Telefonica Brasil (NYSE:VIV) are both large-cap utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, profitability, risk, valuation, earnings and analyst recommendations.

Profitability

This table compares Rogers Communication and Telefonica Brasil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rogers Communication	32.49%	17.14%	3.45%
Telefonica Brasil	10.37%	8.67%	4.75%

Earnings & Valuation

This table compares Rogers Communication and Telefonica Brasil”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rogers Communication	$15.04 billion	1.32	$1.27 billion	$9.00	4.10
Telefonica Brasil	$58.57 billion	0.39	$1.03 billion	$0.66	21.12

Rogers Communication has higher earnings, but lower revenue than Telefonica Brasil. Rogers Communication is trading at a lower price-to-earnings ratio than Telefonica Brasil, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Rogers Communication has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500. Comparatively, Telefonica Brasil has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Rogers Communication and Telefonica Brasil, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rogers Communication	1	4	4	0	2.33
Telefonica Brasil	2	3	3	0	2.13

Rogers Communication currently has a consensus price target of $36.00, indicating a potential downside of 2.39%. Telefonica Brasil has a consensus price target of $13.12, indicating a potential downside of 5.88%. Given Rogers Communication’s stronger consensus rating and higher possible upside, analysts clearly believe Rogers Communication is more favorable than Telefonica Brasil.

Dividends

Rogers Communication pays an annual dividend of $1.43 per share and has a dividend yield of 3.9%. Telefonica Brasil pays an annual dividend of $0.40 per share and has a dividend yield of 2.9%. Rogers Communication pays out 15.9% of its earnings in the form of a dividend. Telefonica Brasil pays out 60.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Rogers Communication is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

45.5% of Rogers Communication shares are held by institutional investors. Comparatively, 5.2% of Telefonica Brasil shares are held by institutional investors. 29.0% of Rogers Communication 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.

Summary

Rogers Communication beats Telefonica Brasil on 13 of the 16 factors compared between the two stocks.

About Rogers Communication

Rogers Communications Inc. operates as a communications and media company in Canada. It operates through three segments: Wireless, Cable, and Media. The company offers mobile Internet access, wireless voice and enhanced voice, device financing, device protection, global voice and data roaming, wireless home phone, bridging landline, machine-to-machine and Internet of Things solutions, and advanced wireless solutions for businesses, as well as device shipping and express pickup services; and postpaid and prepaid services under the Rogers, Fido, and chatr brands. It also provides internet and WiFi services; and monitoring, security, automation, energy efficiency, and smart control through smartphone app. In addition, the company offers local and network TV; on-demand television; cloud-based digital video recorders; voice-activated remote controls, and integrated apps; personal video recorders; linear and time-shifted programming; digital specialty channels; and 4K television programming. Further, it provides residential and small business local telephony services; voicemail, call waiting, and long distance; voice, data networking, Internet protocol (IP), and Ethernet services; private networking, Internet, IP voice, and cloud solutions; optical wave and multi-protocol label switching services; information technology and network technologies; cable access network services; telecommunications technical consulting services; and season games through television, smartphones, tablets, personal computers, and other streaming devices, as well as operates Ignite TV and Ignite TV app. Additionally, the company owns Toronto Blue Jays and the Rogers Centre event venue; and operates Sportsnet ONE, Sportsnet 360, Sportsnet World, Citytv, OMNI, FX (Canada), FXX (Canada), and OLN television networks, as well as 52 AM and FM radio stations. It also offers Rogers and the Rogers World Elite Mastercard. The company was founded in 1960 and is headquartered in Toronto, Canada.

About Telefonica Brasil

Telefônica Brasil S.A., together with its subsidiaries, operates as a mobile telecommunications company in Brazil. Its fixed line services portfolio includes local, domestic long-distance, and international long-distance calls; and mobile portfolio comprises voice and broadband internet access through 3G, 4G, 4.5G, and 5G, as well as mobile value-added and wireless roaming services. The company also offers data services, including broadband and mobile data services. In addition, it provides pay TV services through IPTV technologies; network services, such as rental of facilities; other services comprising internet access, private network connectivity, computer equipment leasing, extended service, caller identification, voice mail, cellular blocker, and others; wholesale services, including interconnection services to users of other network providers; and digital services, such as entertainment, cloud, and security and financial services. Further, the company offers multimedia communication services, which include audio, data, voice and other sounds, images, texts, and other information, as well as sells devices, such as smartphones, broadband USB modems, and other devices. Additionally, it provides telecommunications solutions and IT support to various industries, such as retail, manufacturing, services, financial institutions, government, etc. It markets and sells its solutions through own stores, dealers, retail and distribution channels, door-to-door sales, and outbound tele sales. The company was formerly known as Telecomunicações de São Paulo S.A. – TELESP and changed its name to Telefônica Brasil S.A. in October 2011. The company was incorporated in 1998 and is headquartered in São Paulo, Brazil.