Critical Contrast: John Wiley & Sons (NYSE:WLYB) & National CineMedia (NASDAQ:NCMI)

John Wiley & Sons (NYSE:WLYB) and National CineMedia (NASDAQ:NCMI) are both communication services companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, valuation, earnings and institutional ownership.

Risk and Volatility

John Wiley & Sons has a beta of 0.55, meaning that its stock price is 45% less volatile than the S&P 500. Comparatively, National CineMedia has a beta of 1.37, meaning that its stock price is 37% more volatile than the S&P 500.

Profitability

This table compares John Wiley & Sons and National CineMedia’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
John Wiley & Sons	11.90%	27.99%	8.16%
National CineMedia	-3.05%	-1.31%	-0.99%

Dividends

John Wiley & Sons pays an annual dividend of $1.43 per share and has a dividend yield of 2.9%. National CineMedia pays an annual dividend of $0.12 per share and has a dividend yield of 5.5%. John Wiley & Sons pays out 37.8% of its earnings in the form of a dividend. National CineMedia pays out -133.3% 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. John Wiley & Sons has increased its dividend for 26 consecutive years. National CineMedia is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

0.5% of John Wiley & Sons shares are held by institutional investors. Comparatively, 69.5% of National CineMedia shares are held by institutional investors. 29.7% of John Wiley & Sons shares are held by company insiders. Comparatively, 1.7% of National CineMedia 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.

Analyst Ratings

This is a breakdown of current recommendations for John Wiley & Sons and National CineMedia, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
John Wiley & Sons	0	1	0	0	2.00
National CineMedia	0	3	3	0	2.50

National CineMedia has a consensus target price of $4.81, indicating a potential upside of 122.29%. Given National CineMedia’s stronger consensus rating and higher probable upside, analysts clearly believe National CineMedia is more favorable than John Wiley & Sons.

Earnings & Valuation

This table compares John Wiley & Sons and National CineMedia”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
John Wiley & Sons	$1.68 billion	1.47	$221.62 million	$3.78	12.85
National CineMedia	$249.00 million	0.82	-$10.60 million	($0.09)	-24.06

John Wiley & Sons has higher revenue and earnings than National CineMedia. National CineMedia is trading at a lower price-to-earnings ratio than John Wiley & Sons, indicating that it is currently the more affordable of the two stocks.

Summary

John Wiley & Sons beats National CineMedia on 10 of the 17 factors compared between the two stocks.

About John Wiley & Sons

John Wiley & Sons, Inc. engages in the provision of research and learning materials. It operates through the following segments: Research, Learning, and Held for Sale or Sold. The Research segment consists of research publishing and research solutions. The Learning segment includes academic and professional reporting lines and consists of publishing and related knowledge solutions. The Held for Sale or Sold segment offers businesses held-for-sale including Wiley Edge and CrossKnowledge, University Services and Tuition Manager, and Test Prep and Advancement Courses. The company was founded by Charles Wiley in 1807 and is headquartered in Hoboken, NJ.

About National CineMedia

National CineMedia, Inc., through its subsidiary, National CineMedia, LLC, operates cinema advertising network in North America. It engages in the sale of advertising to national, regional, and local businesses in Noovie, a cinema advertising and entertainment show seen on movie screens; and sells advertising on its Lobby Entertainment Network, a series of strategically-placed screens located in movie theater lobbies, as well as other forms of advertising and promotions in theatre lobbies. The company also sells online and mobile advertising through its Noovie Audience Accelerator product across a suite of Noovie digital properties, such as Name That Movie and Noovie Trivia app to reach entertainment audiences beyond the theater. It offers its services to third-party theater circuits under long-term network affiliate agreements. The company was incorporated in 2006 and is headquartered in Centennial, Colorado.