OI (NYSE: OIBR) and Cincinnati Bell (NYSE:CBB) are both small-cap telecommunications services companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, dividends, earnings, institutional ownership and analyst recommendations.
Institutional & Insider Ownership
83.5% of Cincinnati Bell shares are held by institutional investors. 1.4% of Cincinnati Bell shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This is a summary of current ratings for OI and Cincinnati Bell, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Cincinnati Bell has a consensus target price of $24.00, suggesting a potential upside of 60.54%. Given Cincinnati Bell’s higher possible upside, analysts plainly believe Cincinnati Bell is more favorable than OI.
Risk and Volatility
OI has a beta of 1.91, meaning that its stock price is 91% more volatile than the S&P 500. Comparatively, Cincinnati Bell has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500.
Earnings & Valuation
This table compares OI and Cincinnati Bell’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cincinnati Bell||$1.19 billion||0.53||$102.10 million||$0.94||15.90|
Cincinnati Bell has higher revenue and earnings than OI. OI is trading at a lower price-to-earnings ratio than Cincinnati Bell, indicating that it is currently the more affordable of the two stocks.
This table compares OI and Cincinnati Bell’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Cincinnati Bell beats OI on 9 of the 10 factors compared between the two stocks.
Oi S.A. is an integrated telecommunications service provider in Brazil. The Company is a switched fixed-line telephony services (STFC) concessionaire. It is engaged in the provision of STFC as a local and intraregional long-distance carrier. Its segments include Residential Services, Personal Mobility, and SMEs/Corporate. It offers a range of integrated telecommunications services that include fixed and mobile, broadband, pay television (TV), data transmission and Internet provider services. The Company’s Residential Services segment is focused on the sale of fixed telephony services, including voice services, data communication services (broadband), and pay TV. The Personal Mobility segment is focused on the sale of mobile telephony services to subscription and prepaid customers, and mobile broadband customer. The SMEs/Corporate segment includes corporate solutions offered to its small, medium-sized, and large corporate customers.
About Cincinnati Bell
Cincinnati Bell Inc., along with its subsidiaries, provides diversified telecommunications and technology services. The Company operates through two segments: Entertainment and Communications, and IT Services and Hardware. Through its Entertainment and Communications segment, the Company provides high-speed data, video and voice solutions to consumers and businesses over fiber network and a legacy copper network. The IT Services and Hardware segments operates through its subsidiary, Cincinnati Bell Technology Solutions Inc. (CBTS), which is engaged in the sale and service of end-to-end communications and information technology (IT) systems and solutions for business customers across the United States. The Company has interest in CyrusOne Inc., which operates carrier-neutral data center colocation business.
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