Analyzing Alcatel Lucent (ALU) and Its Peers

Alcatel Lucent (NYSE: ALU) is one of 66 publicly-traded companies in the “Communications & Networking” industry, but how does it contrast to its competitors? We will compare Alcatel Lucent to related businesses based on the strength of its risk, dividends, institutional ownership, analyst recommendations, earnings, valuation and profitability.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Alcatel Lucent and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alcatel Lucent 0 0 0 0 N/A
Alcatel Lucent Competitors 405 2568 4135 170 2.56

As a group, “Communications & Networking” companies have a potential upside of 14.52%. Given Alcatel Lucent’s competitors higher probable upside, analysts plainly believe Alcatel Lucent has less favorable growth aspects than its competitors.

Insider and Institutional Ownership

61.8% of shares of all “Communications & Networking” companies are held by institutional investors. 12.4% of shares of all “Communications & Networking” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Alcatel Lucent and its competitors revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Alcatel Lucent N/A N/A 43.25
Alcatel Lucent Competitors $3.31 billion $373.33 million -131.82

Alcatel Lucent’s competitors have higher revenue and earnings than Alcatel Lucent. Alcatel Lucent 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.

Volatility & Risk

Alcatel Lucent has a beta of 2.05, suggesting that its share price is 105% more volatile than the S&P 500. Comparatively, Alcatel Lucent’s competitors have a beta of 1.15, suggesting that their average share price is 15% more volatile than the S&P 500.

Profitability

This table compares Alcatel Lucent and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alcatel Lucent 14.83% 86.14% 10.96%
Alcatel Lucent Competitors -2.14% -8.61% -0.37%

Summary

Alcatel Lucent beats its competitors on 5 of the 9 factors compared.

About Alcatel Lucent

Alcatel Lucent SA is a provider of Internet protocol (IP) networking, ultra-broadband access and cloud technology solutions. The Company operates through two segments for the networks business. The Ultra Broadband Networks segment consists of Mobile Networks and Fixed Networks business groups. The IP Networks and Applications segment consists of Internet protocol (IP)/Optical Networks and Applications and Analytics business groups. Its other segment consists of businesses run as separate operations (Alcatel Submarine Networks and Radio Frequency Systems (RFS)). The Company offers a range of solutions, including Communications and collaboration, IP Core Routing, IP/optical integration, long term evolution (LTE) Ultra-Broadband, Software-defined networking and Vplus. The Company offers a range of consulting, managed, maintenance and professional services, including Bell Labs Consulting and Build, Operate and Manage (BOM) Solution for Mobility Networks. The main shareholder is Nokia.

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