Critical Analysis: Telecom Argentina Stet – France Telecom (NYSE:TEO) versus Cogent Communications (NASDAQ:CCOI)

Cogent Communications (NASDAQ:CCOI) and Telecom Argentina Stet – France Telecom (NYSE:TEO) are both communication services companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, valuation, risk, institutional ownership, analyst recommendations, earnings and profitability.

Valuation and Earnings

This table compares Cogent Communications and Telecom Argentina Stet – France Telecom”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cogent Communications	$957.21 million	0.49	-$182.17 million	($0.96)	-9.62
Telecom Argentina Stet – France Telecom	$8,926.69 billion	0.00	-$136.01 million	$1.23	11.34

Telecom Argentina Stet – France Telecom has higher revenue and earnings than Cogent Communications. Cogent Communications is trading at a lower price-to-earnings ratio than Telecom Argentina Stet – France Telecom, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Cogent Communications and Telecom Argentina Stet – France Telecom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cogent Communications	-4.73%	-842.48%	-4.86%
Telecom Argentina Stet – France Telecom	7.61%	9.38%	4.11%

Analyst Ratings

This is a breakdown of recent ratings for Cogent Communications and Telecom Argentina Stet – France Telecom, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cogent Communications	2	6	3	0	2.09
Telecom Argentina Stet – France Telecom	1	2	3	0	2.33

Cogent Communications currently has a consensus price target of $19.55, suggesting a potential upside of 111.58%. Telecom Argentina Stet – France Telecom has a consensus price target of $15.93, suggesting a potential upside of 14.15%. Given Cogent Communications’ higher possible upside, analysts clearly believe Cogent Communications is more favorable than Telecom Argentina Stet – France Telecom.

Volatility & Risk

Cogent Communications has a beta of 0.77, indicating that its share price is 23% less volatile than the S&P 500. Comparatively, Telecom Argentina Stet – France Telecom has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Institutional and Insider Ownership

92.4% of Cogent Communications shares are owned by institutional investors. 4.2% of Cogent Communications shares are owned by company insiders. Comparatively, 1.0% of Telecom Argentina Stet – France Telecom shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Telecom Argentina Stet – France Telecom beats Cogent Communications on 9 of the 13 factors compared between the two stocks.

About Cogent Communications

Cogent Communications Holdings, Inc., through its subsidiaries, provides high-speed Internet access, private network, and data center colocation space services in North America, Europe, Oceania, South America, and Africa. The company offers on-net Internet access and private network services to law firms, financial services firms, and advertising and marketing firms, as well as heath care providers, educational institutions and other professional services businesses, other Internet service providers, telephone companies, cable television companies, web hosting companies, media service providers, mobile phone operators, content delivery network companies, and commercial content and application service providers. It also provides Internet access and private network services to customers that are not located in buildings directly connected to its network; and on-net services to customers located in buildings that are physically connected to its network. In addition, the company offers off-net services to corporate customers using other carriers' circuits to provide the last mile portion of the link from the customers' premises to the network. Further, it operates data centers that allow its customers to collocate their equipment and access the network. It serves primarily to small and medium-sized businesses, communications service providers, and other bandwidth-intensive organizations. Cogent Communications Holdings, Inc. was founded in 1999 and is headquartered in Washington, the District of Columbia.

About Telecom Argentina Stet – France Telecom

Telecom Argentina S.A., together with its subsidiaries, provides telecommunications services. The company offers mobile telecommunications services, including voice communications, high-speed mobile Internet content and applications download, online streaming, and other services; and sells mobile communication devices, such as handsets, Modems MiFi and wingles, and smart watches. It also internet connectivity products, including virtual private network services, traditional Internet protocol links, and other products; and programming and other cable television services. In addition, the company offers telephone services, including local, domestic, and international long-distance telephone services, as well as public telephone services; and other related supplementary services, such as call waiting, call forwarding, conference calls, caller ID, voice mail, itemized billing, and maintenance services. Further, it provides Infrastructure, interconnection, datacenter, Internet, value added, and international long-distance services; and data services, including data transmission, virtual private networks, symmetric Internet access, national and international signal transport, and videoconferencing services; Personal Pay, a digital wallet service; and management and administration services. The company was formerly known as Cablevisión S.A. and changed its name to Telecom Argentina S.A. in January 2018. Telecom Argentina S.A. was founded in 1979 and is based in Buenos Aires, Argentina.