Inteliquent (NASDAQ: IQNT) and Telefonica SA (NYSE:TEF) are both telecommunications services companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, profitabiliy, analyst recommendations, risk and valuation.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Inteliquent and Telefonica SA, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Inteliquent 1 0 1 0 2.00
Telefonica SA 2 4 7 0 2.38

Inteliquent presently has a consensus price target of $24.00, indicating a potential upside of 4.80%. Telefonica SA has a consensus price target of $10.51, indicating a potential downside of 8.27%. Given Inteliquent’s higher possible upside, research analysts plainly believe Inteliquent is more favorable than Telefonica SA.

Institutional and Insider Ownership

88.0% of Inteliquent shares are owned by institutional investors. Comparatively, 0.9% of Telefonica SA shares are owned by institutional investors. 5.5% of Inteliquent shares are owned by insiders. Comparatively, 0.0% of Telefonica SA shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Inteliquent and Telefonica SA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Inteliquent 9.43% 19.39% 16.35%
Telefonica SA 5.18% 29.02% 6.53%

Volatility and Risk

Inteliquent has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Telefonica SA has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500.

Earnings and Valuation

This table compares Inteliquent and Telefonica SA’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Inteliquent N/A N/A N/A $1.05 21.81
Telefonica SA $62.49 billion 0.94 $19.54 billion $0.53 21.62

Telefonica SA has higher revenue and earnings than Inteliquent. Telefonica SA is trading at a lower price-to-earnings ratio than Inteliquent, indicating that it is currently the more affordable of the two stocks.

Dividends

Inteliquent pays an annual dividend of $0.47 per share and has a dividend yield of 2.1%. Telefonica SA pays an annual dividend of $0.51 per share and has a dividend yield of 4.5%. Inteliquent pays out 44.8% of its earnings in the form of a dividend. Telefonica SA pays out 96.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Inteliquent beats Telefonica SA on 7 of the 13 factors compared between the two stocks.

About Inteliquent

Inteliquent, Inc. is a provider of voice telecommunications services primarily on a wholesale basis. The Company offers its services using an all-Internet Protocol (IP) network, which enables to deliver connectivity for a range of media, including voice, and data and video. The Company’s solutions enable carriers and other providers to deliver voice traffic or other services where they do not have their own network. These solutions are called off-net services. It also provides solutions to customers, such as over-the-top (OTT) providers. The Company offers a range of services, including Local Transit Service, Long Distance Service, Switched Access Service, International Voice Service, Direct Inward Dialing Service and 8XX (Toll-Free) Service. The Company offers an alternative to facilitate the exchange of local traffic between various carriers by using its tandem switches instead of the Incumbent Local Exchange Carriers’ (ILECs’) tandems or direct connects.

About Telefonica SA

Telefonica, S.A. is an integrated and diversified telecommunications group operating in Europe and Latin America. The Company’s services and products include Mobile business, Fixed-line telephony business and Digital services. Its segments include Telefonica Spain, Telefonica Brazil, Telefonica Germany, Telefonica United Kingdom and Telefonica Hispanoamerica (formed by the Company’s operators in Argentina, Chile, Peru, Colombia, Mexico, Venezuela and Central America, Ecuador and Uruguay). These segments are engaged in activities relating to wireline, wireless, cable, data, Internet and television (TV) businesses and other digital services in accordance with each location. It offers a range of mobile and related services and products to personal and business customers. It offers traditional fixed telecommunication services, Internet and broadband multimedia services and data and business-solutions services. It offers a range of digital services, such as Internet of Things (IoT).

Receive News & Ratings for Inteliquent Inc Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Inteliquent Inc and related companies with MarketBeat.com's FREE daily email newsletter.