Critical Review: Chunghwa Telecom (NYSE:CHT) & Globalstar (NASDAQ:GSAT)

Chunghwa Telecom (NYSE:CHT) and Globalstar (NASDAQ:GSAT) are both large-cap communication services companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Institutional and Insider Ownership

2.1% of Chunghwa Telecom shares are owned by institutional investors. Comparatively, 18.9% of Globalstar shares are owned by institutional investors. 1.0% of Chunghwa Telecom shares are owned by company insiders. Comparatively, 60.0% of Globalstar shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations for Chunghwa Telecom and Globalstar, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chunghwa Telecom	0	2	0	0	2.00
Globalstar	2	3	1	0	1.83

Globalstar has a consensus price target of $75.67, indicating a potential downside of 9.56%. Given Globalstar’s higher possible upside, analysts plainly believe Globalstar is more favorable than Chunghwa Telecom.

Volatility & Risk

Chunghwa Telecom has a beta of 0.27, suggesting that its stock price is 73% less volatile than the S&P 500. Comparatively, Globalstar has a beta of 1.45, suggesting that its stock price is 45% more volatile than the S&P 500.

Valuation and Earnings

This table compares Chunghwa Telecom and Globalstar”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chunghwa Telecom	$7.58 billion	4.73	$1.23 billion	$1.65	28.02
Globalstar	$272.99 million	39.71	-$8.65 million	($0.51)	-164.05

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

Profitability

This table compares Chunghwa Telecom and Globalstar’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chunghwa Telecom	16.11%	10.00%	7.36%
Globalstar	-22.25%	-16.66%	-2.43%

Summary

Chunghwa Telecom beats Globalstar on 8 of the 14 factors compared between the two stocks.

About Chunghwa Telecom

Chunghwa Telecom Co., Ltd., together with its subsidiaries, provides telecommunication services in Taiwan and internationally. It operates through Consumer Business, Enterprise Business, International Business, and Others segments. The company offers local, domestic long distance, and international long distance fixed-line telephone services; mobile services such as prepaid and postpaid plans; broadband plans; and internet and data services. Chunghwa Telecom Co., Ltd. was incorporated in 1996 and is headquartered in Taipei City, Taiwan.

About Globalstar

Globalstar, Inc. provides mobile satellite services worldwide. The company offers duplex two-way voice and data products, including mobile voice and data satellite communications services and equipment for remote business continuity, recreational usage, safety, emergency preparedness and response, and other applications; fixed voice and data satellite communications services and equipment at industrial, commercial, and residential sites, as well as rural villages and ships; and data modem services and equipment. It also provides SPOT consumer retail products, such as SPOT satellite GPS messenger for personal tracking, emergency location, and messaging solutions; and SPOT Trace, an anti-theft and asset tracking device. In addition, the company offers commercial Internet of Things one-way transmission products to track cargo containers and rail cars, as well as to monitor utility meters, and oil and gas assets. Further, it sells wholesale minutes to independent gateway operators (IGOs); and provides engineering services, such as hardware and software designs to develop specific applications; and installation of gateways and antennas. The company distributes its products directly, as well as through independent agents, dealers and resellers, retailers, IGOs, and sales force and e-commerce Website. As of December 31, 2020, it had approximately 745,000 subscribers. The company primarily serves recreation and personal, government, public safety and disaster relief, oil and gas, maritime and fishing, construction, utilities, and transportation, as well as natural resources, mining, and forestry markets. Globalstar, Inc. has a strategic alliance with XCOM Labs to jointly commercialize XCOM’s capacity-multiplying technology with Globalstar’s Band n53 for 5G deployments in the United States and other countries where Globalstar has terrestrial rights. The company was founded in 1993 and is headquartered in Covington, Louisiana.