Comparing PLDT (PHI) & TalkTalk Telecom Group (TKTCY)

PLDT (NYSE:PHI) and TalkTalk Telecom Group (OTCMKTS:TKTCY) are both mid-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Analyst Recommendations

This is a summary of recent ratings and price targets for PLDT and TalkTalk Telecom Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PLDT 2 5 1 0 1.88
TalkTalk Telecom Group 0 0 1 0 3.00

Insider & Institutional Ownership

6.6% of PLDT shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares PLDT and TalkTalk Telecom Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PLDT $3.17 billion 1.80 $264.74 million $2.53 10.45
TalkTalk Telecom Group $2.27 billion 1.05 -$104.80 million $0.12 104.17

PLDT has higher revenue and earnings than TalkTalk Telecom Group. PLDT is trading at a lower price-to-earnings ratio than TalkTalk Telecom Group, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

PLDT has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, TalkTalk Telecom Group has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500.

Dividends

PLDT pays an annual dividend of $0.89 per share and has a dividend yield of 3.4%. TalkTalk Telecom Group pays an annual dividend of $0.17 per share and has a dividend yield of 1.4%. PLDT pays out 35.2% of its earnings in the form of a dividend. TalkTalk Telecom Group pays out 141.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PLDT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares PLDT and TalkTalk Telecom Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PLDT 5.24% 20.18% 5.00%
TalkTalk Telecom Group N/A N/A N/A

Summary

PLDT beats TalkTalk Telecom Group on 11 of the 13 factors compared between the two stocks.

PLDT Company Profile

PLDT Inc. operates as a telecommunications company in the Philippines. The company's Wireless segment offers cellular mobile, Internet broadband distribution, operations support, mobile applications and digital platforms development, mobile payment, solutions and systems integration, satellite communications, and satellite information and messaging services. It also operates as a content provider; develops and maintains IT-based solutions for communications and e-commerce platforms; develops financial technology solutions; provides insurance products; markets, sells, and distributes payment solutions and other related services; and sells Wi-Fi access equipment. As of December 31, 2017, this segment served 58,531,262 wireless subscribers. Its Fixed Line segment provides fixed line telecommunications services; business infrastructure and solutions; intelligent data processing and implementation, and data analytics insight generation services; and information and communications infrastructure for Internet-based services, e-commerce, customer relationship management, and information technology (IT) related services. This segment also offers managed IT outsourcing, Internet-based purchasing, IT consulting and professional, bills printing and other related value-added, and air transportation services, as well as distributes Filipino channels and content services. As of December 31, 2017, it had 2,663,210 fixed line subscribers. The company has a strategic partnership with Rocket Internet SE to develop online and mobile payment solutions. The company was formerly known as Philippine Long Distance Telephone Company and changed its name to PLDT Inc. in July 2016. PLDT Inc. was founded in 1928 and is based in Makati City, the Philippines.

TalkTalk Telecom Group Company Profile

TalkTalk Telecom Group PLC provides fixed line, TV, and mobile telecommunications services. It offers landline, broadband, fiber, TV, and mobile services, including fixed price plans and unlimited broadband usage, as well as HomeSafe, a network-based security and filtering system. The company also provides various business-grade communications products and services, including Internet access, data, voice, and mobile. TalkTalk Telecom Group PLC was founded in 2002 and is based in London, the United Kingdom.

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