Head to Head Comparison: Telesat (NASDAQ:TSAT) versus Liberty Global (NASDAQ:LILAK)

Liberty Global (NASDAQ:LILAK) and Telesat (NASDAQ:TSAT) are both small-cap communication services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, risk and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Liberty Global and Telesat, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liberty Global	1	1	0	0	1.50
Telesat	3	2	2	0	1.86

Liberty Global currently has a consensus price target of $9.00, suggesting a potential upside of 6.13%. Telesat has a consensus price target of $33.50, suggesting a potential downside of 21.77%. Given Liberty Global’s higher possible upside, research analysts plainly believe Liberty Global is more favorable than Telesat.

Insider & Institutional Ownership

53.0% of Liberty Global shares are owned by institutional investors. 9.7% of Liberty Global shares are owned by company insiders. Comparatively, 40.6% of Telesat shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Liberty Global has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, Telesat has a beta of 2.07, indicating that its stock price is 107% more volatile than the S&P 500.

Profitability

This table compares Liberty Global and Telesat’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liberty Global	-2.20%	-8.50%	-0.82%
Telesat	-102.62%	-15.53%	-3.95%

Earnings & Valuation

This table compares Liberty Global and Telesat”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liberty Global	$4.44 billion	0.37	-$611.20 million	($0.49)	-17.31
Telesat	$299.12 million	2.12	-$111.19 million	($17.89)	-2.39

Telesat has lower revenue, but higher earnings than Liberty Global. Liberty Global is trading at a lower price-to-earnings ratio than Telesat, indicating that it is currently the more affordable of the two stocks.

About Liberty Global

Liberty Latin America Ltd., together with its subsidiaries, provides fixed, mobile, and subsea telecommunications services. The company operates through C&W Caribbean, C&W Panama, Liberty Networks, Liberty Puerto Rico, and Liberty Costa Rico segments. It offers communications and entertainment services, including video, broadband internet, fixed-line, telephony, and mobiles services to residential and business customers; and business products and services that include enterprise-grade connectivity, data center, hosting, and managed solutions, as well as information technology solutions for small and medium enterprises, international companies, and governmental agencies. The company also operates a sub-sea and terrestrial fiber optic cable network that connects approximately 40 markets. It provides its services under the brands of C&W, Liberty Costa Rica, Liberty Communications, BTC, Flow, and Mas Móvil. The company was incorporated in 2017 and is based in Hamilton, Bermuda.

About Telesat

Telesat Corporation, a satellite operator, provides mission-critical communications solutions to broadcast, enterprise, and consulting customers worldwide. The company’s satellite-based services allow direct-to-home (DTH) service providers to deliver television programming, audio, and information channels directly to customers’ homes; and enables broadcasters, cable networks, and DTH service providers to transmit television programming services. It offers value-added services that include satellite capacity, digital encoding of video channels, authorization, and uplinking and downlinking services; and occasional use services for the broadcast of video news, sports, and live event coverages. The company also provides satellite capacity and end-to-end services comprising space segment services and terrestrial facilities for enterprise connectivity, and internet and cellular backhaul; rural telephony to telecommunications carriers and network services integrators; and other satellite services. In addition, it offers direct-to-consumer broadband services; communications services for the oil and gas and mining industries; and broadband communication services to maritime and aeronautical markets comprising commercial airplanes and vessels. Further, the company operates satellite and hybrid satellite/terrestrial networks. Additionally, it provides satellite operator services; and consulting services related to space and earth segments, government studies, research and development, and satellite control services. The company offers its services primarily through a direct sales force. As of December 31, 2020, it operated a fleet of 15 in-orbit geostationary satellites and a Canadian payload on the ViaSat-1 satellite. The company was founded in 1969 and is headquartered in Ottawa, Canada. Telesat Corporation is a subsidiary of Loral Space & Communications Inc.