Head-To-Head Contrast: Scholastic (NASDAQ:SCHL) & Grupo Televisa (NYSE:TV)

Scholastic (NASDAQ:SCHL) and Grupo Televisa (NYSE:TV) are both small-cap communication services companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, profitability, institutional ownership, risk, analyst recommendations and earnings.

Volatility and Risk

Scholastic has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500. Comparatively, Grupo Televisa has a beta of 1.55, indicating that its share price is 55% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Scholastic and Grupo Televisa, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Scholastic	0	3	0	0	2.00
Grupo Televisa	2	3	1	0	1.83

Scholastic presently has a consensus target price of $42.00, suggesting a potential upside of 20.59%. Grupo Televisa has a consensus target price of $6.55, suggesting a potential upside of 174.63%. Given Grupo Televisa’s higher probable upside, analysts clearly believe Grupo Televisa is more favorable than Scholastic.

Valuation and Earnings

This table compares Scholastic and Grupo Televisa”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Scholastic	$1.58 billion	0.42	$56.70 million	$2.34	14.88
Grupo Televisa	$57.98 billion	0.02	-$478.58 million	($0.91)	-2.62

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

Dividends

Scholastic pays an annual dividend of $1.00 per share and has a dividend yield of 2.9%. Grupo Televisa pays an annual dividend of $0.08 per share and has a dividend yield of 3.4%. Scholastic pays out 42.7% of its earnings in the form of a dividend. Grupo Televisa pays out -8.8% 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. Grupo Televisa is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

82.6% of Scholastic shares are owned by institutional investors. Comparatively, 55.8% of Grupo Televisa shares are owned by institutional investors. 12.8% of Scholastic shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Scholastic and Grupo Televisa’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Scholastic	3.58%	5.29%	2.43%
Grupo Televisa	-15.28%	-8.33%	-3.87%

Summary

Scholastic beats Grupo Televisa on 10 of the 16 factors compared between the two stocks.

About Scholastic

Scholastic Corporation publishes and distributes children’s books worldwide. It operates in three segments: Children’s Book Publishing and Distribution, Education Solutions, and International. The Children’s Book Publishing and Distribution segment engages in publication and distribution of children’s print, digital, and audio books, as well as media and interactive products through its school reading events and trade channel; and operation of school-based book clubs and book fairs in the United States. Its original publications include The Harry Potter, The Hunger Games, The Bad Guys, The Baby-Sitters Club, The Magic School Bus, Captain Underpants, Dog Man, Wings of Fire, Cat Kid Comic Club, and Clifford The Big Red Dog, as well as I Survived, Goosebumps; licensed properties comprising the Peppa Pig and Pokemon; and publishes and creates Klutz and Make Believe Ideas titles, such as Mini Shake Shop, Pokemon Stained Glass, LEGO Miniature Photography, and the Never Touch series. The Education Solutions segment publishes and distributes classroom magazines under the Scholastic News, Scholastic Scope, Storyworks, Let’s Find Out, and Junior Scholastic names; supplemental and classroom materials and programs, and related support services; and print and on-line reference, and non-fiction products, as well as consulting services. The International segment publishes and distributes English, Hindi, and French language children’s books; and operates school-based marketing channels, as well as supply original and licensed children’s books, and supplemental educational materials including professional books for teachers. It distributes its products and services directly to schools and libraries through retail stores and the Internet. The company was founded in 1920 and is headquartered in New York, New York.

About Grupo Televisa

Grupo Televisa, S.A.B., together with its subsidiaries, owns and operates cable companies and provides direct-to-home satellite pay television system in Mexico and the United States. It operates through three segments: Cable, Sky, and Other Businesses. The Cable segment operates cable multiple system that provides basic and premium television subscription, pay-per-view, installation, Internet subscription, and telephone and mobile services subscription, as well as local and national advertising services; and telecommunication facilities, which offers data and long-distance services solutions to carriers and other telecommunications service providers through its fiber-optic network. The Sky segment offers direct-to-home broadcast satellite pay television services comprising program, installation, and equipment rental services to subscribers in Mexico, Central America, and the Dominican Republic; and national advertising sales. The Other Businesses segment is involved in the sports and show business promotion, soccer, publishing and publishing distribution, and gaming, as well as provides transmission concessions and facilities. The company was founded in 1969 and is headquartered in Mexico City, Mexico.