Head to Head Comparison: KT (KT) & Centurylink (CTL)

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KT (NYSE:KT) and Centurylink (NYSE:CTL) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Profitability

This table compares KT and Centurylink’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KT N/A N/A N/A
Centurylink -7.39% 5.68% 1.73%

Institutional & Insider Ownership

33.5% of KT shares are held by institutional investors. Comparatively, 75.3% of Centurylink shares are held by institutional investors. 1.0% of KT shares are held by company insiders. Comparatively, 0.6% of Centurylink 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 and Valuation

This table compares KT and Centurylink’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
KT $21.35 billion 0.30 $415.40 million $0.88 14.97
Centurylink $23.44 billion 0.55 -$1.73 billion $1.19 10.02

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

Analyst Ratings

This is a summary of current ratings and recommmendations for KT and Centurylink, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KT 0 3 0 0 2.00
Centurylink 5 7 3 0 1.87

Centurylink has a consensus price target of $16.96, suggesting a potential upside of 42.28%. Given Centurylink’s higher possible upside, analysts plainly believe Centurylink is more favorable than KT.

Dividends

Centurylink pays an annual dividend of $1.00 per share and has a dividend yield of 8.4%. KT does not pay a dividend. Centurylink pays out 84.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. KT has increased its dividend for 2 consecutive years.

Volatility and Risk

KT has a beta of 0.48, indicating that its stock price is 52% less volatile than the S&P 500. Comparatively, Centurylink has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500.

Summary

Centurylink beats KT on 10 of the 17 factors compared between the two stocks.

KT Company Profile

KT Corporation provides telecommunications services in Korea and internationally. The company offers local, domestic long-distance, and international long-distance fixed-line and voice over Internet protocol fixed-line telephone services, as well as interconnection services; broadband Internet access service and other Internet-related services, including IPTV services; and data communication services, such as leased line and broadband Internet connection services to institutional customers. It also provides mobile voice and data telecommunications, credit card processing and other financial, and satellite TV and media content services. In addition, the company offers information technology and network services. Further, it plans and develops commercial and office buildings and condominiums, as well as leases buildings; maintains public telephones; manages sports groups; develops medicine and pharmacy; and sells communication devices. Additionally, the company offers security, B2C and B2B, investment fund, software development and data processing, Internet banking ASP and security, value added network, system integration and maintenance, mobile marketing, and PCS distribution services. It also provides TV content, residential building development and supply, asset management and consulting, cloud system, data center development, satellite communication, music contents investment, technology business finance, advertising agency, network installation and management, system integration and maintenance, foreign investment, electronic communication, and wireless high speed Internet services, as well as call center services for the financial sectors. As of December 31, 2017, the company served approximately 20,015,000 mobile subscribers and 7.5 million IPTV subscribers. The company was formerly known as Korea Telecom Corp. and changed its name to KT Corporation in March 2002. KT Corporation was founded in 1981 and is headquartered in Seongnam, South Korea.

Centurylink Company Profile

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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