Critical Contrast: AST SpaceMobile (NASDAQ:ASTS) versus IHS (NYSE:IHS)

IHS (NYSE:IHS) and AST SpaceMobile (NASDAQ:ASTS) are both communication services companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Institutional and Insider Ownership

17.5% of IHS shares are owned by institutional investors. Comparatively, 61.0% of AST SpaceMobile shares are owned by institutional investors. 20.9% of AST SpaceMobile shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

IHS has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, AST SpaceMobile has a beta of 2.72, indicating that its stock price is 172% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for IHS and AST SpaceMobile, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IHS	1	4	2	0	2.14
AST SpaceMobile	2	7	5	0	2.21

IHS presently has a consensus target price of $8.80, indicating a potential upside of 4.45%. AST SpaceMobile has a consensus target price of $84.58, indicating a potential upside of 34.00%. Given AST SpaceMobile’s stronger consensus rating and higher probable upside, analysts plainly believe AST SpaceMobile is more favorable than IHS.

Profitability

This table compares IHS and AST SpaceMobile’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IHS	8.17%	-832.09%	11.80%
AST SpaceMobile	-536.66%	-22.88%	-10.67%

Earnings and Valuation

This table compares IHS and AST SpaceMobile”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IHS	$1.58 billion	1.80	$143.60 million	$0.40	21.06
AST SpaceMobile	$70.92 million	346.37	-$341.94 million	($2.14)	-29.50

IHS has higher revenue and earnings than AST SpaceMobile. AST SpaceMobile is trading at a lower price-to-earnings ratio than IHS, indicating that it is currently the more affordable of the two stocks.

Summary

AST SpaceMobile beats IHS on 8 of the 14 factors compared between the two stocks.

About IHS

IHS Inc. develops source of information, insight and analytics in different areas of business. The Company’s segments include Resources, Transportation and Consolidated Markets & Solutions. The Company’s Resources segment includes its Energy and Chemicals product offerings. Its Transportation segment includes its Automotive; Maritime & Trade, and Aerospace, Defense & Security product offerings. Its Consolidated Markets & Solutions segment includes its Product Design; Technology, Media & Telecom, and Economics & Country Risk product offerings. It provides authoritative analysis and forecasts of sales and production for light vehicles, medium and heavy commercial vehicles, powertrain, components and technology systems across various markets. Its product design offerings include content and analysis on various engineering and technical standards, codes, reference books, journals, and other scientific and technical documents, as well as software-based engineering decision engines.

About AST SpaceMobile

AST SpaceMobile, Inc., together with its subsidiaries, develops and provides access to a space-based cellular broadband network for smartphones in the United States. Its SpaceMobile service provides cellular broadband services to end-users who are out of terrestrial cellular coverage. The company was founded in 2017 and is headquartered in Midland, Texas.