Shaw Communications (NYSE: SJR) and TELUS (NYSE:TU) are both telecommunications services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, profitability, risk, valuation, earnings and analyst recommendations.
Institutional and Insider Ownership
62.8% of Shaw Communications shares are held by institutional investors. Comparatively, 55.2% of TELUS shares are held by institutional investors. 1.0% of Shaw Communications shares are held by company 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.
This is a summary of recent ratings for Shaw Communications and TELUS, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Shaw Communications currently has a consensus price target of $27.33, indicating a potential upside of 43.48%. TELUS has a consensus price target of $46.17, indicating a potential upside of 28.67%. Given Shaw Communications’ higher possible upside, analysts clearly believe Shaw Communications is more favorable than TELUS.
This table compares Shaw Communications and TELUS’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Shaw Communications and TELUS’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Shaw Communications||$3.70 billion||2.45||$644.63 million||$0.91||20.93|
|TELUS||$10.26 billion||2.08||$1.13 billion||$1.90||18.88|
TELUS has higher revenue and earnings than Shaw Communications. TELUS is trading at a lower price-to-earnings ratio than Shaw Communications, indicating that it is currently the more affordable of the two stocks.
Shaw Communications pays an annual dividend of $0.92 per share and has a dividend yield of 4.8%. TELUS pays an annual dividend of $1.61 per share and has a dividend yield of 4.5%. Shaw Communications pays out 101.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TELUS pays out 84.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TELUS has raised its dividend for 2 consecutive years.
Risk & Volatility
Shaw Communications has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500. Comparatively, TELUS has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.
TELUS beats Shaw Communications on 9 of the 17 factors compared between the two stocks.
Shaw Communications Company Profile
Shaw Communications Inc. (Shaw) is a diversified connectivity provider. The Company operates through four divisions: Consumer, Wireless, Business Network Services and Business Infrastructure Services. Under the Consumer division, the Company offers Cable telecommunications and Satellite video services to residential customers. Its Business Network Services division offers data networking, Cable telecommunications, Satellite video and fleet tracking services to businesses and public sector entities. Its Business Infrastructure Services division offers data center colocation, cloud technology and managed information technology (IT) solutions to businesses. The Company offers wireless services for voice and data communications through its Wireless division. Its wireline services offer approximately 120 high definition (HD) channels and over 10,000 on-demand, pay-per-view and subscription movie and television programming titles.
TELUS Company Profile
TELUS Corporation (TELUS) is a telecommunications company. The Company provides a range of telecommunications services and products, including wireless and wireline voice and data. Its data services include Internet protocol (IP), television (TV), hosting, managed information technology and cloud-based services, and certain healthcare solutions. The Company operates through two business segments: Wireless segment and Wireline segment. Its wireless and wireline businesses are primarily operated through TELUS Communications Company (TCC). The Company offers business services, including healthcare, across wireless and wireline are supported through TELUS sales representatives, product specialists, independent dealers and online self-serve applications for small and medium-sized businesses (SMBs). Its business process outsourcing services are supported through sales representatives and client relationship management teams.
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