Analyzing Orange (ORAN) and Shaw Communications (SJR)
Orange (NYSE: ORAN) and Shaw Communications (NYSE:SJR) are both large-cap telecommunications services companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.
Orange pays an annual dividend of $0.52 per share and has a dividend yield of 3.0%. Shaw Communications pays an annual dividend of $0.92 per share and has a dividend yield of 4.0%. Orange pays out 260.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Shaw Communications pays out 104.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Shaw Communications is clearly the better dividend stock, given its higher yield and lower payout ratio.
Institutional and Insider Ownership
1.2% of Orange shares are owned by institutional investors. Comparatively, 52.4% of Shaw Communications shares are owned by institutional investors. 1.0% of Shaw Communications shares are owned 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.
This table compares Orange and Shaw Communications’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk & Volatility
Orange has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500. Comparatively, Shaw Communications has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500.
This is a summary of recent ratings and recommmendations for Orange and Shaw Communications, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Shaw Communications has a consensus price target of $27.75, indicating a potential upside of 21.71%. Given Shaw Communications’ higher possible upside, analysts clearly believe Shaw Communications is more favorable than Orange.
Earnings & Valuation
This table compares Orange and Shaw Communications’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Orange||$45.29 billion||1.02||$3.25 billion||$0.20||87.10|
|Shaw Communications||$3.70 billion||2.94||$644.63 million||$0.88||25.91|
Orange has higher revenue and earnings than Shaw Communications. Shaw Communications is trading at a lower price-to-earnings ratio than Orange, indicating that it is currently the more affordable of the two stocks.
Shaw Communications beats Orange on 11 of the 16 factors compared between the two stocks.
Orange SA is a telecommunications operator. The Company also provides telecommunication services to multinational companies, under the brand Orange Business Services. The Company’s segments include France, Spain, Poland, Belgium and Luxembourg, Central European countries, Africa and Middle East, Enterprise, and International Carriers & Shared Services. The Company provides consumers, businesses and other telecommunications operators with a range of services, including fixed telephony and mobile telecommunications, data transmission and other value-added services, mainly in Europe, Africa and the Middle East. The Company offers fixed-line telephony, mobile telephony and Internet services in France. The Company offers fixed-line telephony, mobile telephony and Internet services in Spain. The Company offers fixed-line and mobile telephony, and Internet services in Poland. The Company operates through Mobistar and Groupama Banque SA.
About Shaw Communications
Shaw Communications Inc. (Shaw) is a diversified connectivity provider. The Company operates through four divisions: Consumer, Wireless, Business Network Services and Business Infrastructure Services. Under the Consumer division, the Company offers Cable telecommunications and Satellite video services to residential customers. Its Business Network Services division offers data networking, Cable telecommunications, Satellite video and fleet tracking services to businesses and public sector entities. Its Business Infrastructure Services division offers data center colocation, cloud technology and managed information technology (IT) solutions to businesses. The Company offers wireless services for voice and data communications through its Wireless division. Its wireline services offer approximately 120 high definition (HD) channels and over 10,000 on-demand, pay-per-view and subscription movie and television programming titles.
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