Critical Analysis: Neustar (NYSE:NSR) & BT Group PLC (BT)
Neustar (NYSE: NSR) and BT Group PLC (NYSE:BT) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitabiliy, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.
Insider & Institutional Ownership
88.8% of Neustar shares are held by institutional investors. Comparatively, 1.0% of BT Group PLC shares are held by institutional investors. 2.9% of Neustar shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Neustar and BT Group PLC’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Neustar||$1.22 billion||1.52||$473.09 million||$3.27||10.18|
|BT Group PLC||$31.28 billion||1.34||$8.89 billion||$1.04||20.26|
BT Group PLC has higher revenue and earnings than Neustar. Neustar is trading at a lower price-to-earnings ratio than BT Group PLC, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Neustar and BT Group PLC, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|BT Group PLC||3||7||8||0||2.28|
Neustar presently has a consensus target price of $29.50, suggesting a potential downside of 11.41%. BT Group PLC has a consensus target price of $357.94, suggesting a potential upside of 1,598.82%. Given BT Group PLC’s stronger consensus rating and higher probable upside, analysts clearly believe BT Group PLC is more favorable than Neustar.
This table compares Neustar and BT Group PLC’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|BT Group PLC||7.14%||40.09%||6.79%|
Volatility and Risk
Neustar has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500. Comparatively, BT Group PLC has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500.
BT Group PLC pays an annual dividend of $0.90 per share and has a dividend yield of 4.3%. Neustar does not pay a dividend. BT Group PLC pays out 86.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BT Group PLC has increased its dividend for 5 consecutive years.
BT Group PLC beats Neustar on 9 of the 17 factors compared between the two stocks.
NeuStar, Inc. is a global information services provider. The Company’s cloud-based platforms and differentiated data sets offer informative, real-time analytics, which enable clients to make actionable, data-driven decisions. It provides chief marketing officers a suite of services to plan their media spends, identify and locate desired customers, invest in marketing campaigns, deliver relevant offers and measure the performance of these activities. Security professionals use the Company’s solutions to maximize Web performance and protect against malicious attacks. It enables the exchange of essential operating information across multiple carriers to provision and manage services, assisting clients with order processing and routing of customer inquiries. The Company’s services include marketing services, security services, data services and number portability administration center (NPAC) services.
About BT Group PLC
BT Group plc is a communications services company. The Company is engaged in selling fixed-voice services, broadband, mobile and television products and services, as well as managed networked information technology (IT) solutions and cyber security protection. Its segments include Consumer, which provides fixed-voice, broadband, TV and mobile services; EE, which is a mobile network operator in the United Kingdom and provides mobile and fixed communications services to consumers; Business and Public Sector, which provides communications and IT services to businesses and the public sector in the United Kingdom and the Republic of Ireland (RoI) ;Global Services, which provides managed networked IT services to corporate customers; Wholesale and Ventures, which provides fixed and mobile services to communications providers (CPs); and Openreach, which provides copper and fiber connections between its exchanges and homes and businesses.
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