Critical Survey: VEON (NASDAQ:VEON) versus Tele2 (OTCMKTS:TLTZY)

Tele2 (OTCMKTS:TLTZY) and VEON (NASDAQ:VEON) are both communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Tele2 and VEON, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tele2	0	5	1	1	2.43
VEON	0	2	3	1	2.83

VEON has a consensus target price of $90.33, suggesting a potential upside of 18.42%. Given VEON’s stronger consensus rating and higher possible upside, analysts clearly believe VEON is more favorable than Tele2.

Valuation & Earnings

This table compares Tele2 and VEON”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tele2	$3.06 billion	3.67	$468.79 million	$0.78	10.45
VEON	$4.40 billion	1.28	$532.00 million	$0.85	89.74

VEON has higher revenue and earnings than Tele2. Tele2 is trading at a lower price-to-earnings ratio than VEON, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Tele2 and VEON’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tele2	33.96%	43.42%	15.54%
VEON	1.24%	14.93%	2.78%

Institutional and Insider Ownership

21.3% of VEON shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Tele2 has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500. Comparatively, VEON has a beta of 1.62, meaning that its stock price is 62% more volatile than the S&P 500.

Summary

VEON beats Tele2 on 9 of the 13 factors compared between the two stocks.

About Tele2

Tele2 AB (publ) provides fixed and mobile connectivity, handset related data services, and entertainment services in Sweden, Lithuania, Latvia, and Estonia. The company offers mobile telephony and data, fixed broadband, fixed telephony, switch and contact center, cloud services, IT services, network services, workplace, video and collaboration, united communications, and security services. The company also provides data network services, including dark fiber, dedicated wavelength, ethernet and IP VPN, and internet services; and unified communications comprising service provider, mobile virtual network operator, and carrier SIP-interconnect services. In addition, it offers single and dual IMSI solutions for consumer and IoT applications; on-demand roaming services, such as subscription management, data plan management, real time charging, eSIM delivery, SIM management, and set up services; routing and termination solutions for international voice traffic; application-2-person messaging services; and value-added services comprising shortcodes and long numbers for businesses to have 2-way communication with their customers. The company was incorporated in 1990 and is headquartered in Kista, Sweden.

About VEON

VEON Ltd., a digital operator, provides connectivity and internet services in Pakistan, Ukraine, Kazakhstan, Bangladesh, Uzbekistan, and Kyrgyzstan. It offers mobile telecommunications services, including value added and call completion, national and international roaming, wireless Internet access, mobile financial, and mobile bundle services; data connectivity, cross border transit, voice, Internet, and data services; fixed-line telecommunications using intercity fiber optic networks; and Internet-TV using Fiber to the building technology. The company also sells equipment, infrastructure, and accessories. VEON Ltd. was founded in 1992 and is headquartered in Amsterdam, the Netherlands.