Analyzing KT (NYSE:KT) and Level 3 Communications (LVLT)

Level 3 Communications (NYSE: LVLT) and KT (NYSE:KT) are both mid-cap telecommunications services companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, valuation, profitability, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of current ratings for Level 3 Communications and KT, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Level 3 Communications 1 3 0 0 1.75
KT 1 0 1 0 2.00

Level 3 Communications presently has a consensus target price of $60.16, indicating a potential upside of 12.18%. Given Level 3 Communications’ higher probable upside, equities analysts plainly believe Level 3 Communications is more favorable than KT.

Volatility & Risk

Level 3 Communications has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500. Comparatively, KT has a beta of 0.54, indicating that its share price is 46% less volatile than the S&P 500.

Profitability

This table compares Level 3 Communications and KT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Level 3 Communications 7.47% 5.52% 2.45%
KT N/A N/A N/A

Institutional & Insider Ownership

98.8% of Level 3 Communications shares are held by institutional investors. Comparatively, 23.7% of KT shares are held by institutional investors. 0.5% of Level 3 Communications shares are held by company insiders. Comparatively, 1.0% of KT shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Level 3 Communications and KT’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Level 3 Communications N/A N/A N/A $1.77 30.30
KT $19.13 billion 0.41 $637.52 million N/A N/A

KT has higher revenue and earnings than Level 3 Communications.

Summary

Level 3 Communications beats KT on 6 of the 10 factors compared between the two stocks.

Level 3 Communications Company Profile

Level 3 Communications, Inc. is a provider of a range of integrated communications services. The Company’s operating segments include North America, EMEA and Latin America. The North America includes operations in Atlanta, Georgia; Littleton, Colorado; Miami, Florida; Montreal, Canada; New York, New York; Phoenix, Arizona; Pittsburgh, Pennsylvania; Southfield, Michigan, and Tulsa, Oklahoma. The Europe segment includes operations in Basingstoke, England; Crewe, England; Dublin, Ireland; London, England; Amsterdam, The Netherlands, and Paris, France. The Latin America includes operations in Colombia; Buenos Aires, Argentina; Caracas, Venezuela; Lima, Peru; Quito, Ecuador; Santiago, Chile, and Sao Paulo, Brazil. It offers optical, Internet Protocol, computing and storage technologies. It offers a range of communications services, including Internet Protocol (IP) and data services, transport and fiber services, colocation and data center services, security services and voice services.

KT Company Profile

KT Corporation is a telecommunications service provider. The Company’s segments include the Customer/Marketing Group, the Finance Business Group and the Others Group. The Customer/Marketing Group segment is engaged in providing various telecommunication services to individual/home/corporate customers and the convergence business. The Finance Business Group segment is engaged in providing various financial services, such as credit card. The Others Group segment includes security services, satellite service, information technology and network services, and satellite television services, as well as global business services, which provide global network services to multinational or domestic corporate customers and telecommunications companies. The Company’s principal services include mobile voice and data telecommunications services; fixed-line services; credit card processing and other financial services, and various other services.

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