Alaska Communications Systems Group (NASDAQ:ALSK) and Centurylink (NYSE:CTL) are both utilities companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, risk, analyst recommendations, earnings and institutional ownership.
This table compares Alaska Communications Systems Group and Centurylink’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alaska Communications Systems Group||1.93%||2.75%||0.99%|
This table compares Alaska Communications Systems Group and Centurylink’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Alaska Communications Systems Group||$226.90 million||0.36||-$6.10 million||($0.09)||-17.00|
|Centurylink||$17.66 billion||1.16||$1.39 billion||$1.47||12.86|
Centurylink has higher revenue and earnings than Alaska Communications Systems Group. Alaska Communications Systems Group is trading at a lower price-to-earnings ratio than Centurylink, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations and price targets for Alaska Communications Systems Group and Centurylink, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alaska Communications Systems Group||0||0||1||0||3.00|
Centurylink has a consensus target price of $21.50, indicating a potential upside of 13.70%. Given Centurylink’s higher probable upside, analysts plainly believe Centurylink is more favorable than Alaska Communications Systems Group.
Institutional and Insider Ownership
43.2% of Alaska Communications Systems Group shares are held by institutional investors. Comparatively, 76.8% of Centurylink shares are held by institutional investors. 6.9% of Alaska Communications Systems Group shares are held by company insiders. Comparatively, 0.6% of Centurylink shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Volatility and Risk
Alaska Communications Systems Group has a beta of 0.34, meaning that its stock price is 66% less volatile than the S&P 500. Comparatively, Centurylink has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.
Centurylink pays an annual dividend of $2.16 per share and has a dividend yield of 11.4%. Alaska Communications Systems Group does not pay a dividend. Centurylink pays out 146.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Centurylink beats Alaska Communications Systems Group on 13 of the 16 factors compared between the two stocks.
About Alaska Communications Systems Group
Alaska Communications Systems Group, Inc., through its subsidiaries, provides broadband telecommunication and managed information technology services to business, wholesale, and consumer customers in the state of Alaska. Its services include voice and broadband services; and managed IT services comprising remote network monitoring and support service, managed IT security and IT professional services, and long distance services primarily over its own terrestrial network to business and wholesale customers. The company's business customers comprise large enterprises; federal, state, and local governments; and small and medium business. It also provides voice and broadband services to residential customers; voice and broadband origination and termination services to inter and intrastate carriers; and access and support services. In addition, Alaska Communications Systems Group, Inc. owns and operates AKORN, an undersea fiber optic cable systems. The company markets and sells its products through direct sales channels. Alaska Communications Systems Group, Inc. was founded in 1998 and is based in Anchorage, Alaska.
CenturyLink, Inc. provides various communications services to residential, business, wholesale, and governmental customers primarily in the United States. It operates in two segments, Business and Consumer. The company offers virtual private network data network services; Ethernet services; Internet protocol services; CenturyLink Prism TV that allows customers to watch television or cable channels and record up to four shows on one home digital video recorder; and Vyvx, which provides audio and video feeds over fiber or satellite for broadcast and production customers, as well as satellite digital television services. It also provides broadband services, which allow customers to connect to the Internet through their existing telephone lines or fiber-optic cables; private line solution for transmission of data between sites; colocation and data center services comprising cloud, hosting, and application management solutions; wavelength services that provide customers required bandwidth with an end-to-end transport solution of a bandwidth; and network security solutions, as well as sells telecommunications equipment and resells software, and provides network management, installation and maintenance of data equipment, and building of fiber-optic broadband networks. In addition, the company offers local calling services; long-distance and toll-free services; information technology (IT) services, such as transporting and delivering enterprise data and applications; and managed services consisting of network, hosting, cloud, and IT services. Further, it leases and subleases space in its office buildings, warehouses, and other properties. As of December 31, 2017, the company operated approximately 10.3 million total access lines; and served approximately 5.7 million broadband subscribers. CenturyLink, Inc. was founded in 1968 and is based in Monroe, Louisiana.
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