Alaska Communications Systems Group (NASDAQ: ALSK) and Shenandoah Telecommunications (NASDAQ:SHEN) are both small-cap utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitabiliy, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.
Shenandoah Telecommunications pays an annual dividend of $0.25 per share and has a dividend yield of 0.7%. Alaska Communications Systems Group does not pay a dividend. Shenandoah Telecommunications pays out -227.3% of its earnings in the form of a dividend.
This is a summary of current ratings and recommmendations for Alaska Communications Systems Group and Shenandoah Telecommunications, as reported by MarketBeat.
Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score Alaska Communications Systems Group 0 0 1 0 3.00 Shenandoah Telecommunications 0 0 2 0 3.00
Alaska Communications Systems Group presently has a consensus price target of $3.00, suggesting a potential upside of 27.12%. Shenandoah Telecommunications has a consensus price target of $34.00, suggesting a potential downside of 5.29%. Given Alaska Communications Systems Group’s higher possible upside, equities analysts plainly believe Alaska Communications Systems Group is more favorable than Shenandoah Telecommunications.
This table compares Alaska Communications Systems Group and Shenandoah Telecommunications’ net margins, return on equity and return on assets.
Net Margins Return on Equity Return on Assets Alaska Communications Systems Group -0.65% -0.01% N/A Shenandoah Telecommunications -0.89% 5.43% 1.11%
Institutional & Insider Ownership
41.1% of Alaska Communications Systems Group shares are held by institutional investors. Comparatively, 49.1% of Shenandoah Telecommunications shares are held by institutional investors.
6.5% of Alaska Communications Systems Group shares are held by company insiders. Comparatively, 7.2% of Shenandoah Telecommunications shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Alaska Communications Systems Group and Shenandoah Telecommunications’ revenue, earnings per share and valuation.
Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio Alaska Communications Systems Group $227.27 million 0.54 $55.16 million ($0.02) -117.94 Shenandoah Telecommunications $619.55 million 2.84 $273.78 million ($0.11) -326.36
Shenandoah Telecommunications has higher revenue and earnings than Alaska Communications Systems Group. Shenandoah Telecommunications is trading at a lower price-to-earnings ratio than Alaska Communications Systems Group, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Alaska Communications Systems Group has a beta of -0.12, indicating that its stock price is 112% less volatile than the S&P 500. Comparatively, Shenandoah Telecommunications has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500.
Shenandoah Telecommunications beats Alaska Communications Systems Group on 11 of the 15 factors compared between the two stocks.
About Alaska Communications Systems Group
Alaska Communications Systems Group, Inc. is a fiber broadband and managed information technology (IT) services provider. The Company is focused primarily on business and wholesale customers in and out of Alaska. The Company also provides telecommunication services to consumers across Alaska. The Company’s facilities-based communications network extends across Alaska and connects to the contiguous states through its undersea fiber optic cable systems and its usage rights on an undersea system.
It serves customers in various areas, such as Business and Wholesale (broadband, voice and managed IT services); Consumer (broadband and voice services), and Other Services (including carrier termination, equipment sales, access services and support services receiving federal support funding). It provides voice and broadband services to residential customers. It provides voice and broadband origination and termination services to inter and intrastate carriers serving its retail customers.
About Shenandoah Telecommunications
Shenandoah Telecommunications Company is a telecommunications holding company. The Company’s segments are Wireless, Cable, Wireline and Other. The Company, through its operating subsidiaries, provides both regulated and unregulated telecommunications services to end user customers and other telecommunications providers in Virginia, West Virginia, central Pennsylvania, western Maryland, and portions of Kentucky and Ohio. The business of the Wireless segment is conducted principally by the Company’s subsidiary, Shenandoah Personal Communications, LLC (PCS). The business of the Company’s Cable segment is conducted through Shenandoah Cable Television, LLC (Shenandoah Cable). The Wireline segment provides regulated and unregulated voice services, digital subscriber line (DSL) Internet access, cable modem and long distance access services throughout Shenandoah County and portions of Rockingham, Frederick, Warren and Augusta counties, Virginia.
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