LICT (OTCMKTS:LICT) and China Telecom (NYSE:CHA) are both utilities companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, valuation, analyst recommendations, dividends and profitability.
Earnings & Valuation
This table compares LICT and China Telecom’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|LICT||$115.82 million||3.18||$25.59 million||N/A||N/A|
|China Telecom||$54.85 billion||0.68||$3.20 billion||$3.81||12.04|
China Telecom has higher revenue and earnings than LICT.
Institutional & Insider Ownership
1.4% of LICT shares are owned by institutional investors. Comparatively, 0.5% of China Telecom shares are owned by institutional investors. 26.1% of LICT shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
LICT has a beta of 0.26, meaning that its share price is 74% less volatile than the S&P 500. Comparatively, China Telecom has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500.
This table compares LICT and China Telecom’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of current ratings for LICT and China Telecom, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
China Telecom has a consensus target price of $53.90, suggesting a potential upside of 17.48%. Given China Telecom’s higher probable upside, analysts clearly believe China Telecom is more favorable than LICT.
China Telecom pays an annual dividend of $1.44 per share and has a dividend yield of 3.1%. LICT does not pay a dividend. China Telecom pays out 37.8% of its earnings in the form of a dividend. China Telecom has increased its dividend for 2 consecutive years.
China Telecom beats LICT on 7 of the 13 factors compared between the two stocks.
LICT Corporation, together with its subsidiaries, provides broadband and voice services to residential, commercial, and governmental customers. The company offers high speed broadband services, including Internet access through copper-based digital subscriber lines (DSL), fiber optic facilities, fixed wireless, and cable modems; video services through traditional cable television services and Internet protocol television services; voice over Internet protocol; wireless communications; and other related telecommunications services. It operates in California, Illinois, Iowa, Kansas, Michigan, Nevada, New Hampshire, New Mexico, Oregon, Utah, and Wisconsin. As of December 31, 2017, it had a total of 33,661 voice lines, including access and competitive local exchange carrier (CLEC); 4,358 miles of fiber optic cable; 11,702 miles of copper cable; and 605 miles of coaxial cable. The company was formerly known as Lynch Interactive Corporation and changed its name to LICT Corporation in March 2007. LICT Corporation was incorporated in 1996 and is based in Rye, New York.
About China Telecom
China Telecom Corporation Limited, together with its subsidiaries, provides wireline and mobile telecommunications services primarily in the People's Republic of China. It offers wireline voice services, including local wireline telephone services and long distance wireline services; CDMA mobile voice services, such as local calls, domestic and international long distance calls, intra-provincial roaming, and inter-provincial roaming and international roaming; wireline Internet access services comprising dial-up and broadband services; wireless Internet access services; and wireline, Internet, and mobile value-added services. The company also provides Best Tone information services; and information technology-based integrated solutions, such as system integration, outsourcing, special advisory, information application, knowledge, and software development services. In addition, it offers managed data services that include digital data network, frame relay, and asynchronous transfer mode services for government agencies, large corporations, and institutions; and leased line services, as well as sells, repairs, and maintains customer-end equipment. Further, the company provides international telecommunications services, including network equipment, international Internet access and transit, Internet data center, and mobile virtual network services in various countries, including the Asia Pacific, Europe, Africa, South America, and North America; and music production and related information, instant messenger, and e-commerce services, as well as sells telecommunications terminals. As of December 31, 2018, it had approximately 303 million mobile subscribers; 146 million wireline broadband subscribers; and 116 million access lines in service. The company was incorporated in 2002 and is based in Wanchai, Hong Kong. China Telecom Corporation Limited is a subsidiary of China Telecommunications Corporation.
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