IDT (NYSE: IDT) and PLDT (NYSE:PHI) are both telecommunications services companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, risk, analyst recommendations, earnings, institutional ownership, valuation and dividends.

Analyst Recommendations

This is a summary of current ratings and price targets for IDT and PLDT, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IDT 0 0 0 0 N/A
PLDT 1 3 2 0 2.17

Profitability

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

Net Margins Return on Equity Return on Assets
IDT -1.03% 7.53% 2.31%
PLDT 16.32% 25.56% 6.29%

Valuation & Earnings

This table compares IDT and PLDT’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
IDT $1.50 billion 0.19 $8.17 million ($0.66) -16.95
PLDT $3.49 billion 1.74 $422.12 million ($3.55) -7.90

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

Volatility & Risk

IDT has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500. Comparatively, PLDT has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500.

Dividends

IDT pays an annual dividend of $0.76 per share and has a dividend yield of 6.8%. PLDT pays an annual dividend of $1.23 per share and has a dividend yield of 4.4%. IDT pays out -115.2% of its earnings in the form of a dividend. PLDT pays out -34.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. IDT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

52.8% of IDT shares are owned by institutional investors. Comparatively, 9.0% of PLDT shares are owned by institutional investors. 21.8% of IDT shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

PLDT beats IDT on 8 of the 14 factors compared between the two stocks.

About IDT

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.

About PLDT

PLDT, Inc., formerly Philippine Long Distance Telephone Company (PLDT), is a telecommunications service provider in the Philippines. The Company operates through three business segments: Wireless, Fixed Line and Others. The Company, through its business segments, offers a range of telecommunications services across the Philippines’ fiber optic backbone and wireless and fixed line networks. The Company’s wireless segment provides cellular, wireless broadband and other services, and digital platforms and mobile financial services. Its Fixed Line segment provides local exchange, international long distance, national long distance, data and other network and miscellaneous services under its fixed line business. It offers postpaid and prepaid fixed line services. Its Other business consists of PLDT Communications and Energy Ventures, Inc. (PCEV), an investment holding company. It also focuses on providing wireless voice communications and wireless data communications.

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