Analyzing Spirent Communications (SPMYY) & Cincinnati Bell (CBB)

Spirent Communications (OTCMKTS:SPMYY) and Cincinnati Bell (NYSE:CBB) are both computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitability.

Insider and Institutional Ownership

94.4% of Cincinnati Bell shares are held by institutional investors. 1.0% of Spirent Communications shares are held by company insiders. Comparatively, 2.4% of Cincinnati Bell 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 Spirent Communications and Cincinnati Bell’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Spirent Communications $476.90 million N/A $55.80 million $0.43 17.69
Cincinnati Bell $1.38 billion 0.33 -$69.80 million ($1.11) -8.11

Spirent Communications has higher earnings, but lower revenue than Cincinnati Bell. Cincinnati Bell is trading at a lower price-to-earnings ratio than Spirent Communications, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Spirent Communications has a beta of 0.83, suggesting that its share price is 17% less volatile than the S&P 500. Comparatively, Cincinnati Bell has a beta of 1.62, suggesting that its share price is 62% more volatile than the S&P 500.

Dividends

Spirent Communications pays an annual dividend of $0.19 per share and has a dividend yield of 2.5%. Cincinnati Bell does not pay a dividend. Spirent Communications pays out 44.2% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Spirent Communications and Cincinnati Bell, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Spirent Communications 0 0 0 0 N/A
Cincinnati Bell 0 2 1 0 2.33

Cincinnati Bell has a consensus price target of $14.33, indicating a potential upside of 59.26%. Given Cincinnati Bell’s higher possible upside, analysts clearly believe Cincinnati Bell is more favorable than Spirent Communications.

Profitability

This table compares Spirent Communications and Cincinnati Bell’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Spirent Communications N/A N/A N/A
Cincinnati Bell -5.06% N/A -1.69%

Summary

Cincinnati Bell beats Spirent Communications on 7 of the 13 factors compared between the two stocks.

About Spirent Communications

Spirent Communications plc provides solutions to develop devices and equipment and to operate networks worldwide. The company operates through three segments: Networks & Security, Lifecycle Service Assurance, and Connected Devices. The Networks & Security segment develops performance and security test systems to accelerate the development of new devices, networks, and applications for high-speed Ethernet/IP, mobile, and global satellite navigation systems. The Lifecycle Service Assurance segment develops active test and analytics solutions for service turn-up, network performance improvement, and customer experience management. The Connected Devices develops automated test systems; and offers services to test new devices in the lab or on networks. The company was formerly known as Spirent plc and changed its name to Spirent Communications plc in May 2006. Spirent Communications plc was founded in 1936 and is headquartered in Crawley, the United Kingdom.

About Cincinnati Bell

Cincinnati Bell Inc., together with its subsidiaries, provides diversified telecommunications and technology services to residential and business customers in the United States. It operates in two segments, Entertainment and Communications, and IT Services and Hardware. The Entertainment and Communications segment offers data services, including high-speed Internet access, data transport, and interconnection services, as well as metro-Ethernet products; and voice local services, as well as long distance, digital trunking, switched access, and other value-added services, such as caller identification, voicemail, call waiting, and call return. This segment also provides video services comprising entertainment channels, including digital music, local, movie, and sports programming with high-definition (HD) channels, parental controls, HD DVR, and video on-demand. In addition, this segment undertakes wiring projects for business customers; and offers advertising, directory assistance, maintenance, and information services. The IT Services and Hardware segment provides consulting services consisting of IT staffing and project-based engagements, including engineering and installation of voice, connectivity and IT technologies, development of digital application solutions, and staff augmentation; and hosted solutions comprising converged IP communications platforms of data, voice, video, and mobility applications. This segment also offers cloud services, such as virtual data center, storage, and backup services; and monitoring and managing technology environments and applications, as well as sells, architects, and installs telecommunications and IT infrastructure equipment. The company was founded in 1873 and is headquartered in Cincinnati, Ohio.

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