Telstra (OTCMKTS:TLSYY) and KT (NYSE:KT) are both utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, risk, institutional ownership, valuation, dividends and analyst recommendations.
Telstra pays an annual dividend of $0.53 per share and has a dividend yield of 3.9%. KT pays an annual dividend of $0.40 per share and has a dividend yield of 3.3%. Telstra pays out 45.7% of its earnings in the form of a dividend. KT pays out 31.3% 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. KT has raised its dividend for 2 consecutive years.
This is a breakdown of recent ratings for Telstra and KT, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
This table compares Telstra and KT’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Telstra and KT’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Telstra||$20.17 billion||1.60||$2.76 billion||$1.16||11.71|
|KT||$21.35 billion||0.28||$587.47 million||$1.28||9.41|
Telstra has higher earnings, but lower revenue than KT. KT is trading at a lower price-to-earnings ratio than Telstra, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Telstra has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, KT has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.
Insider and Institutional Ownership
0.1% of Telstra shares are held by institutional investors. Comparatively, 34.0% of KT shares are held by institutional investors. 1.0% of KT shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Telstra beats KT on 7 of the 13 factors compared between the two stocks.
Telstra Company Profile
Telstra Corporation Limited, together with its subsidiaries, provides telecommunications and information services to businesses, governments, communities, and individuals in Australia and internationally. It operates in four segments: Telstra Consumer and Small Business, Telstra Enterprise, Telstra Operations, and Telstra Wholesale. The company offers telecommunication products, services, and solutions across mobiles, fixed and mobile broadband, telephony and pay television/Internet protocol, and digital content; and online self-service capabilities, including buying, billing, and servicing requests, as well as operates inbound and outbound call centers, owned and licensed Telstra shops, and the Telstra dealership network. It also provides sales and contract management services for medium to large business and government customers; and product management services for advanced technology solutions and services, such as data and Internet protocol networks, and mobility applications and services, as well as network applications and services products comprising managed network, unified communications, cloud, industry solutions, and integrated services and monitoring. In addition, the company engages in the development of industry vertical solutions; planning, design, engineering architecture, and construction of Telstra networks, technology, and information technology solutions; and provision of a range of telecommunication products and services to other carriers, carriage service providers, and Internet service providers through its networks and related support systems. Further, it provides disconnection, media and marketing, and other services. The company was formerly known as Australian and Overseas Telecommunications Corporation Limited and changed its name to Telstra Corporation Limited in April 1993. Telstra Corporation Limited was founded in 1901 and is based in Melbourne, Australia.
KT Company Profile
KT Corporation provides telecommunications services in Korea and internationally. The company offers local, domestic long-distance, and international long-distance fixed-line and voice over Internet protocol fixed-line telephone services, as well as interconnection services; broadband Internet access service and other Internet-related services, including IPTV services; and data communication services, such as leased line and broadband Internet connection services to institutional customers. It also provides mobile voice and data telecommunications, credit card processing and other financial, and satellite TV and media content services. In addition, the company offers information technology and network services. Further, it plans and develops commercial and office buildings and condominiums, as well as leases buildings; maintains public telephones; manages sports groups; develops medicine and pharmacy; and sells communication devices. Additionally, the company offers security, B2C and B2B, investment fund, software development and data processing, Internet banking ASP and security, value added network, system integration and maintenance, mobile marketing, and PCS distribution services. It also provides TV content, residential building development and supply, asset management and consulting, cloud system, data center development, satellite communication, music contents investment, technology business finance, advertising agency, network installation and management, system integration and maintenance, foreign investment, electronic communication, and wireless high speed Internet services, as well as call center services for the financial sectors. As of December 31, 2017, the company served approximately 20,015,000 mobile subscribers and 7.5 million IPTV subscribers. The company was formerly known as Korea Telecom Corp. and changed its name to KT Corporation in March 2002. KT Corporation was founded in 1981 and is headquartered in Seongnam, South Korea.
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