BT Group (NYSE: BT) and IDT (NYSE:IDT) are both utilities companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.

Dividends

BT Group pays an annual dividend of $0.96 per share and has a dividend yield of 5.2%. IDT pays an annual dividend of $0.76 per share and has a dividend yield of 6.9%. BT Group pays out 94.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. IDT pays out -115.2% of its earnings in the form of a dividend. BT Group has increased its dividend for 6 consecutive years. IDT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares BT Group and IDT’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
BT Group $31.47 billion 1.16 $2.49 billion $1.02 18.11
IDT $1.50 billion 0.18 $8.17 million ($0.66) -16.73

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

Risk and Volatility

BT Group has a beta of 0.98, indicating that its share price is 2% less volatile than the S&P 500. Comparatively, IDT has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for BT Group and IDT, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BT Group 3 8 6 0 2.18
IDT 0 0 0 0 N/A

BT Group presently has a consensus price target of $333.33, suggesting a potential upside of 1,704.73%. Given BT Group’s higher possible upside, equities research analysts clearly believe BT Group is more favorable than IDT.

Profitability

This table compares BT Group and IDT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BT Group 6.52% 34.46% 6.24%
IDT -1.03% 7.53% 2.31%

Insider and Institutional Ownership

0.9% of BT Group shares are held by institutional investors. Comparatively, 52.5% of IDT shares are held by institutional investors. 21.8% of IDT shares are held by company 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.

Summary

BT Group beats IDT on 10 of the 16 factors compared between the two stocks.

BT Group Company Profile

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.

IDT Company Profile

IDT Corporation is a holding company with operations primarily in the telecommunications and payment industries. The Company’s segments include Telecom Platform Services, Consumer Phone Services and All Other. The Company’s Telecom Platform Services segment provides retail telecommunications and payment offerings, as well as wholesale international long distance traffic termination. The Telecom Platform Services segment markets and distributes multiple communications and payment services across four businesses: Retail Communications, Wholesale Carrier Services, Payment Services and Hosted Platform Solutions. The Company’s Consumer Phone Services segment provides consumer local and long distance services in certain states of the United States. The Telecom Platform Services and Consumer Phone Services segments comprise the Company’s IDT Telecom division. The All Other segment includes its real estate holdings and other smaller businesses.

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