Critical Analysis: Axtel SAB (OTCMKTS:AXTLF) and Chunghwa Telecom (NYSE:CHT)

Chunghwa Telecom (NYSE:CHT) and Axtel SAB (OTCMKTS:AXTLF) are both utilities companies, but which is the better business? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, profitability, valuation, earnings and analyst recommendations.

Profitability

This table compares Chunghwa Telecom and Axtel SAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chunghwa Telecom	16.27%	9.72%	7.17%
Axtel SAB	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings for Chunghwa Telecom and Axtel SAB, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chunghwa Telecom	0	1	0	0	2.00
Axtel SAB	0	1	0	0	2.00

Given Axtel SAB’s higher possible upside, analysts plainly believe Axtel SAB is more favorable than Chunghwa Telecom.

Earnings and Valuation

This table compares Chunghwa Telecom and Axtel SAB”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chunghwa Telecom	$7.16 billion	N/A	$1.13 billion	$1.53	28.27
Axtel SAB	N/A	N/A	N/A	N/A	N/A

Chunghwa Telecom has higher revenue and earnings than Axtel SAB.

Volatility & Risk

Chunghwa Telecom has a beta of 0.26, indicating that its share price is 74% less volatile than the S&P 500. Comparatively, Axtel SAB has a beta of 2.7, indicating that its share price is 170% more volatile than the S&P 500.

Institutional and Insider Ownership

2.1% of Chunghwa Telecom shares are held by institutional investors. 1.0% of Chunghwa Telecom shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Chunghwa Telecom beats Axtel SAB on 6 of the 8 factors compared between the two stocks.

About Chunghwa Telecom

Chunghwa Telecom Co., Ltd., together with its subsidiaries, provides telecommunication services in Taiwan and internationally. It operates through Consumer Business, Enterprise Business, International Business, and Others segments. The company offers local, domestic long distance, and international long distance fixed-line telephone services; mobile services such as prepaid and postpaid plans; broadband plans; and internet and data services. Chunghwa Telecom Co., Ltd. was incorporated in 1996 and is headquartered in Taipei City, Taiwan.

About Axtel SAB

AXTEL SAB de CV engages in the provision of public telecommunication services. It operates through the following segments: Business Operation and Government. The Business Operation segment offers communication services and value-added services, such as information, data and internet technologies for both local and international businesses. The Government segment provides services through the company’s network and infrastructure for the federal, state and municipal governments. The company was founded on July 22, 1994 and is headquartered in San Pedro Garza Garcia, Mexico.