Comparing ATN International (ATNI) & Telefonica Brasil (VIV)

Telefonica Brasil (NYSE: VIV) and ATN International (NASDAQ:ATNI) are both utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Profitability

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

Net Margins Return on Equity Return on Assets
Telefonica Brasil 9.41% 5.91% 3.97%
ATN International 4.29% 2.74% 1.87%

Volatility and Risk

Telefonica Brasil has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500. Comparatively, ATN International has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Insider & Institutional Ownership

10.0% of Telefonica Brasil shares are owned by institutional investors. Comparatively, 59.2% of ATN International shares are owned by institutional investors. 32.7% of ATN International shares are owned by company insiders. 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 Telefonica Brasil and ATN International’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Telefonica Brasil $13.46 billion 1.99 $4.42 billion $0.74 21.41
ATN International $518.69 million 1.65 $159.87 million $1.36 38.75

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Telefonica Brasil and ATN International, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Telefonica Brasil 0 2 1 0 2.33
ATN International 0 1 1 0 2.50

Telefonica Brasil presently has a consensus target price of $15.00, suggesting a potential downside of 5.30%. ATN International has a consensus target price of $57.00, suggesting a potential upside of 8.16%. Given ATN International’s stronger consensus rating and higher probable upside, analysts plainly believe ATN International is more favorable than Telefonica Brasil.

Dividends

Telefonica Brasil pays an annual dividend of $0.55 per share and has a dividend yield of 3.5%. ATN International pays an annual dividend of $0.68 per share and has a dividend yield of 1.3%. Telefonica Brasil pays out 74.3% of its earnings in the form of a dividend. ATN International pays out 50.0% 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. Telefonica Brasil has increased its dividend for 15 consecutive years and ATN International has increased its dividend for 4 consecutive years. Telefonica Brasil is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Telefonica Brasil beats ATN International on 9 of the 16 factors compared between the two stocks.

Telefonica Brasil Company Profile

Telefonica Brasil S.A. is a mobile telecommunications company in Brazil offering postpaid mobile services. The Company also operates as a fixed telecommunications company in the state of Sao Paulo. The Company markets its mobile services under its Vivo brand. It offers its clients a portfolio of products, including mobile and fixed voice, mobile data, fixed broadband, ultra-fast broadband, Pay television, information technology and digital services. Its operations consist of local and long distance fixed telephone services; mobile services, including value-added services; data services, including broadband services and mobile data services; Pay television services through direct to home (DTH), Internet protocol television (IPTV) and cable; network services, such as rental of facilities, as well as other services; wholesale services, including interconnection; digital services; services designed specifically for corporate customers, and the sale of wireless devices and accessories.

ATN International Company Profile

ATN International, Inc. (ATN), formerly Atlantic Tele-Network, Inc., is a holding company. The Company’s segments include U.S. Telecom, International Telecom and Renewable Energy. In the United States, it provides wholesale wireless voice and data roaming services in rural markets to national, regional, local and selected international wireless carriers. Its wholesale networks are located principally in the western United States. It provides wireless voice and data service to retail and business customers in Bermuda under the One name, in Guyana under the GTT name and in the United States Virgin Islands under the Innovative and Choice brand names. The Company offers voice services that include local exchange, regional and long distance calling and voice messaging services in Bermuda, Guyana, the United States Virgin Islands, and in other smaller markets in the Caribbean and the United States. It offers services, which include Wireless, Wireline and Renewable Energy.

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