Globalstar (NASDAQ:GSAT – Get Free Report) and Telefonica (NYSE:TEF – Get Free Report) are both large-cap communication services companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.
Earnings and Valuation
This table compares Globalstar and Telefonica”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Globalstar | $272.99 million | 39.33 | -$8.65 million | ($0.51) | -162.51 |
| Telefonica | $40.55 billion | 0.53 | -$53.02 million | ($0.41) | -9.29 |
Globalstar has higher earnings, but lower revenue than Telefonica. Globalstar is trading at a lower price-to-earnings ratio than Telefonica, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
18.9% of Globalstar shares are owned by institutional investors. Comparatively, 1.1% of Telefonica shares are owned by institutional investors. 60.0% of Globalstar shares are owned by company insiders. Comparatively, 0.0% of Telefonica shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current ratings and price targets for Globalstar and Telefonica, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Globalstar | 1 | 4 | 1 | 0 | 2.00 |
| Telefonica | 3 | 3 | 0 | 0 | 1.50 |
Globalstar presently has a consensus target price of $75.67, indicating a potential downside of 8.70%. Telefonica has a consensus target price of $4.12, indicating a potential upside of 8.01%. Given Telefonica’s higher possible upside, analysts clearly believe Telefonica is more favorable than Globalstar.
Profitability
This table compares Globalstar and Telefonica’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Globalstar | -22.25% | -16.66% | -2.43% |
| Telefonica | -5.23% | 8.54% | 1.96% |
Volatility & Risk
Globalstar has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500. Comparatively, Telefonica has a beta of 0.29, meaning that its stock price is 71% less volatile than the S&P 500.
About Globalstar
Globalstar, Inc. provides mobile satellite services worldwide. The company offers duplex two-way voice and data products, including mobile voice and data satellite communications services and equipment for remote business continuity, recreational usage, safety, emergency preparedness and response, and other applications; fixed voice and data satellite communications services and equipment at industrial, commercial, and residential sites, as well as rural villages and ships; and data modem services and equipment. It also provides SPOT consumer retail products, such as SPOT satellite GPS messenger for personal tracking, emergency location, and messaging solutions; and SPOT Trace, an anti-theft and asset tracking device. In addition, the company offers commercial Internet of Things one-way transmission products to track cargo containers and rail cars, as well as to monitor utility meters, and oil and gas assets. Further, it sells wholesale minutes to independent gateway operators (IGOs); and provides engineering services, such as hardware and software designs to develop specific applications; and installation of gateways and antennas. The company distributes its products directly, as well as through independent agents, dealers and resellers, retailers, IGOs, and sales force and e-commerce Website. As of December 31, 2020, it had approximately 745,000 subscribers. The company primarily serves recreation and personal, government, public safety and disaster relief, oil and gas, maritime and fishing, construction, utilities, and transportation, as well as natural resources, mining, and forestry markets. Globalstar, Inc. has a strategic alliance with XCOM Labs to jointly commercialize XCOM’s capacity-multiplying technology with Globalstar’s Band n53 for 5G deployments in the United States and other countries where Globalstar has terrestrial rights. The company was founded in 1993 and is headquartered in Covington, Louisiana.
About Telefonica
Telefónica, S.A., together with its subsidiaries, provides telecommunications services in Europe and Latin America. The company offers mobile and related services and products, such as mobile voice, value added, mobile data and internet, wholesale, corporate, roaming, fixed wireless, and trunking and paging services. It also provides fixed telecommunication services, including PSTN lines; ISDN accesses; public telephone services; local, domestic, and international long-distance and fixed-to-mobile communications; corporate communications; supplementary value-added services; video telephony; intelligent network; and telephony information services, as well as leases and sells handset equipment and telephony information services. It also provides Internet and broadband multimedia services comprising internet service provider, portal and network, retail and wholesale broadband access, narrowband switched access, security, internet through fibre to the home, and voice over internet protocol services. In addition, the company offers leased line, virtual private network, fibre optics, web hosting and application, managed hosting, content delivery, outsourcing and application, desktop, and system integration and professional services. Further, the company offers wholesale services for telecommunication operators, including domestic interconnection and international wholesale services; leased lines for other operators; and local loop leasing services, as well as bit stream services, wholesale line rental accesses, and leased ducts for other operators' fiber deployment. Additionally, it provides video/TV services; smart connectivity and services, and consumer IoT products; financial and other payment, security, cloud, advertising, big data, and digital experience services; Aura; open gateway, living apps; smart Wi-Fi, Phoenix, NT, Solar 360, and Movistar Home devices. Telefónica, S.A. was incorporated in 1924 and is headquartered in Madrid, Spain.
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