Turkcell Iletisim Hizmetleri A.S. (NYSE:TKC) and China Telecom (NYSE:CHA) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Profitability

This table compares Turkcell Iletisim Hizmetleri A.S. and China Telecom’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Turkcell Iletisim Hizmetleri A.S. 9.77% 13.07% 4.75%
China Telecom N/A N/A N/A

Institutional & Insider Ownership

3.1% of Turkcell Iletisim Hizmetleri A.S. shares are owned by institutional investors. Comparatively, 0.6% of China Telecom shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Turkcell Iletisim Hizmetleri A.S. and China Telecom, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Turkcell Iletisim Hizmetleri A.S. 0 1 1 0 2.50
China Telecom 3 2 1 0 1.67

Valuation and Earnings

This table compares Turkcell Iletisim Hizmetleri A.S. and China Telecom’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Turkcell Iletisim Hizmetleri A.S. $4.38 billion 1.30 $416.10 million $0.48 13.50
China Telecom $54.20 billion 0.82 $2.76 billion $3.40 16.06

China Telecom has higher revenue and earnings than Turkcell Iletisim Hizmetleri A.S.. Turkcell Iletisim Hizmetleri A.S. is trading at a lower price-to-earnings ratio than China Telecom, indicating that it is currently the more affordable of the two stocks.

Dividends

Turkcell Iletisim Hizmetleri A.S. pays an annual dividend of $0.32 per share and has a dividend yield of 4.9%. China Telecom pays an annual dividend of $1.32 per share and has a dividend yield of 2.4%. Turkcell Iletisim Hizmetleri A.S. pays out 66.7% of its earnings in the form of a dividend. China Telecom pays out 38.8% 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. China Telecom has increased its dividend for 2 consecutive years.

Risk & Volatility

Turkcell Iletisim Hizmetleri A.S. has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500. Comparatively, China Telecom has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Turkcell Iletisim Hizmetleri A.S. Company Profile

Turkcell Iletisim Hizmetleri A.S. provides mobile telecommunication services for consumer, corporate, and wholesale customers. The company operates in two segments, Turkcell Turkey and Turkcell International. It offers mobile communication and fixed voice services; and broadband services that consist of mobile broadband, fiber to the home/building, and ADSL. The company also provides BiP, an integrated IP-based communication platform; Turkcell TV+, which enables its subscribers to watch live television channels and on-demand video content; fizy, a digital music platform; Lifebox, a cloud service for data storage; Dergilik, a digital publishing platform; Yaani, a search engine application; My Account, an application for customers to track their bills and usage; Goals on Your Mobile, an application that allows fans to follow their sports team; Turkcell Academy that provides digital learning contents and services; and UpCall, a call management service. In addition, it offers Turkcell Smart Enablers, a mobile-based network that offers services for companies to know their customers; Turkcell Smart Map service; location based services; authentication services; Mobile Signature, which enables mobile subscribers to sign on electronic documents and transactions; Mobile Connect; Cloud services; Machine to Machine and Internet of Things; mobile marketing and corporate messaging services; management information system, and e-commerce platform. Further, the company provides international roaming, and wholesale voice and data services. As of December 31, 2017, it had approximately 15.6 million prepaid subscribers and 18.5 million postpaid subscribers; and approximately 2.1 million fixed line customers. The company covers 3.1 million homes with its fiber infrastructure. The company was founded in 1993 and is headquartered in Istanbul, Turkey. Turkcell Iletisim Hizmetleri A.S. is a subsidiary of Turkcell Holding A.S.

China Telecom Company Profile

China Telecom Corporation Limited, together with its subsidiaries, provides wireline and mobile telecommunications services primarily in the People's Republic of China. It offers wireline voice services, including local wireline telephone services and long distance wireline services; CDMA mobile voice services, such as local calls, domestic and international long distance calls, intra-provincial roaming, and inter-provincial roaming and international roaming; wireline Internet access services comprising dial-up and broadband services; wireless Internet access services; and wireline, Internet, and mobile value-added services. The company also provides Best Tone information services; and information technology-based integrated solutions, such as system integration, outsourcing, special advisory, information application, knowledge, and software development services. In addition, it offers managed data services that include digital data network, frame relay, and asynchronous transfer mode services for government agencies, large corporations, and institutions; and leased line services, as well as sells, repairs, and maintains customer-end equipment. Further, the company provides international telecommunications services, including lease of network equipment, international Internet access and transit, Internet data center, and mobile virtual network services in various countries, including the Asia Pacific, Europe, Africa, South America, and North America; and music production and related information, instant messenger, and e-commerce services, as well as sells telecommunications terminals and calling cards. As of December 31, 2017, it had approximately 122 million access lines in service; 134 million wireline broadband subscribers; and 250 million mobile subscribers. The company was incorporated in 2002 and is based in Beijing, the People's Republic of China. China Telecom Corporation Limited is a subsidiary of China Telecommunications Corporation.

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