Cincinnati Bell (NYSE: CBB) and BCE (NYSE:BCE) are both utilities companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, earnings, institutional ownership, valuation and risk.
Volatility and Risk
Cincinnati Bell has a beta of 1.66, indicating that its stock price is 66% more volatile than the S&P 500. Comparatively, BCE has a beta of 0.36, indicating that its stock price is 64% less volatile than the S&P 500.
Institutional and Insider Ownership
85.1% of Cincinnati Bell shares are owned by institutional investors. Comparatively, 44.4% of BCE shares are owned by institutional investors. 1.4% of Cincinnati Bell shares are owned by insiders. Comparatively, 0.2% of BCE shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a summary of recent ratings and price targets for Cincinnati Bell and BCE, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Cincinnati Bell currently has a consensus target price of $23.50, suggesting a potential upside of 14.63%. BCE has a consensus target price of $57.25, suggesting a potential upside of 22.41%. Given BCE’s stronger consensus rating and higher possible upside, analysts plainly believe BCE is more favorable than Cincinnati Bell.
BCE pays an annual dividend of $2.13 per share and has a dividend yield of 4.6%. Cincinnati Bell does not pay a dividend. BCE pays out 87.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Cincinnati Bell and BCE’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings & Valuation
This table compares Cincinnati Bell and BCE’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Cincinnati Bell||$1.17 billion||0.74||$282.90 million||$1.65||12.42|
|BCE||$17.48 billion||2.41||$6.55 billion||$2.44||19.17|
BCE has higher revenue and earnings than Cincinnati Bell. Cincinnati Bell is trading at a lower price-to-earnings ratio than BCE, indicating that it is currently the more affordable of the two stocks.
BCE beats Cincinnati Bell on 11 of the 16 factors compared between the two stocks.
About Cincinnati Bell
Cincinnati Bell Inc., along with its subsidiaries, provides diversified telecommunications and technology services. The Company operates through two segments: Entertainment and Communications, and IT Services and Hardware. Through its Entertainment and Communications segment, the Company provides high-speed data, video and voice solutions to consumers and businesses over fiber network and a legacy copper network. The IT Services and Hardware segments operates through its subsidiary, Cincinnati Bell Technology Solutions Inc. (CBTS), which is engaged in the sale and service of end-to-end communications and information technology (IT) systems and solutions for business customers across the United States. The Company has interest in CyrusOne Inc., which operates carrier-neutral data center colocation business.
BCE Inc. is a communications company. The Company’s segments include Bell Wireless, Bell Wireline and Bell Media. Its Bell Wireless segment provides wireless voice and data communications products and services to its residential, small and medium-sized business and large enterprise customers across Canada. Its Bell Wireline segment provides data, including Internet access and Internet protocol television (IPTV), local telephone, long distance, as well as other communications services and products to its residential, small and medium-sized business and large enterprise customers, primarily in Ontario, Quebec and the Atlantic provinces, while Satellite television (TV) service and connectivity to business customers are available nationally across Canada. Its Bell Media segment provides conventional, specialty and pay Television, digital media, and radio broadcasting services and out of home (OOH) advertising services to customers across Canada.
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