Critical Comparison: SK Telecom Co. (SKM) and Its Rivals

SK Telecom Co. (NYSE: SKM) is one of 36 publicly-traded companies in the “Wireless Telecommunications Services” industry, but how does it contrast to its competitors? We will compare SK Telecom Co. to similar companies based on the strength of its profitability, institutional ownership, valuation, earnings, risk, analyst recommendations and dividends.

Institutional and Insider Ownership

11.9% of SK Telecom Co. shares are held by institutional investors. Comparatively, 40.3% of shares of all “Wireless Telecommunications Services” companies are held by institutional investors. 1.0% of SK Telecom Co. shares are held by company insiders. Comparatively, 12.5% of shares of all “Wireless Telecommunications Services” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

SK Telecom Co. has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500. Comparatively, SK Telecom Co.’s competitors have a beta of 0.78, suggesting that their average stock price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for SK Telecom Co. and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SK Telecom Co. 0 3 1 0 2.25
SK Telecom Co. Competitors 509 1567 1747 56 2.35

As a group, “Wireless Telecommunications Services” companies have a potential upside of 18.81%. Given SK Telecom Co.’s competitors stronger consensus rating and higher possible upside, analysts plainly believe SK Telecom Co. has less favorable growth aspects than its competitors.

Profitability

This table compares SK Telecom Co. and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SK Telecom Co. 11.62% 12.56% 6.73%
SK Telecom Co. Competitors -994.58% 4.47% -5.15%

Dividends

SK Telecom Co. pays an annual dividend of $0.72 per share and has a dividend yield of 2.9%. SK Telecom Co. pays out 25.7% of its earnings in the form of a dividend. As a group, “Wireless Telecommunications Services” companies pay a dividend yield of 3.0% and pay out 59.3% of their earnings in the form of a dividend.

Valuation & Earnings

This table compares SK Telecom Co. and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
SK Telecom Co. $15.16 billion $4.03 billion 8.80
SK Telecom Co. Competitors $27.19 billion $8.09 billion 7.38

SK Telecom Co.’s competitors have higher revenue and earnings than SK Telecom Co.. SK Telecom Co. is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

SK Telecom Co. competitors beat SK Telecom Co. on 10 of the 15 factors compared.

About SK Telecom Co.

SK Telecom Co., Ltd. provides wireless telecommunications in Korea. The Company is engaged in the commercial development and implementation of wireless and fixed-line technologies and services, as well as develop its platforms, including Internet of things (IoT) solutions, lifestyle enhancement and advanced media. It operates through three segments: cellular services, which include wireless voice and data transmission services, sales of wireless devices, IoT solutions platform services and lifestyle enhancement platform services; fixed-line telecommunication services, which include fixed-line telephone services, broadband Internet services, advanced media platform services (including Internet Protocol television (IPTV)) and business communications services, and other businesses, which include its commerce business, its hardware business and other operations. Its brands include SK Telecom, T-Roaming, 7Mobile, B phone, 00700, B tv, Syrup, UO Smart Beam Laser, Astell&Kern and Nate.

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