Analyzing Bandwidth (NASDAQ:BAND) and NTT (OTCMKTS:NTTYY)

NTT (OTCMKTS:NTTYY) and Bandwidth (NASDAQ:BAND) are both communication services companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Insider & Institutional Ownership

0.1% of NTT shares are owned by institutional investors. Comparatively, 68.5% of Bandwidth shares are owned by institutional investors. 5.3% of Bandwidth shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares NTT and Bandwidth’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NTT	7.17%	10.43%	2.45%
Bandwidth	0.27%	1.85%	0.70%

Volatility and Risk

NTT has a beta of 0.05, indicating that its stock price is 95% less volatile than the S&P 500. Comparatively, Bandwidth has a beta of 3.03, indicating that its stock price is 203% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for NTT and Bandwidth, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NTT	0	2	0	0	2.00
Bandwidth	0	3	5	0	2.62

Bandwidth has a consensus price target of $59.80, suggesting a potential upside of 22.47%. Given Bandwidth’s stronger consensus rating and higher possible upside, analysts clearly believe Bandwidth is more favorable than NTT.

Earnings & Valuation

This table compares NTT and Bandwidth”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NTT	$95.72 billion	0.95	$6.84 billion	$2.09	13.30
Bandwidth	$753.82 million	2.08	-$12.91 million	($0.29)	-168.38

NTT has higher revenue and earnings than Bandwidth. Bandwidth is trading at a lower price-to-earnings ratio than NTT, indicating that it is currently the more affordable of the two stocks.

About NTT

Nippon Telegraph and Telephone Corporation operates as a telecommunications company in Japan and internationally. It operates through Integrated ICT Business, Regional Communications Business, Global Solutions Business, and Others segments. The Integrated ICT Business segment offers mobile phone, domestic inter-prefectural communications, international communications, solutions, and system development and related services. The Regional Communications Business segment provides intra-prefectural communications and related ancillary services. The Global Solutions Business segment offers consulting, system and software development, network system, cloud, global data center, and related services. The Others segment engages in the real estate, energy, and other businesses. The company was founded in 1952 and is headquartered in Tokyo, Japan.

About Bandwidth

Bandwidth is a leading enterprise cloud communications company. Companies like Cisco, Google, Microsoft, RingCentral, Uber, and Zoom use Bandwidth’s APIs to easily embed voice, messaging, and emergency services into software and applications. Bandwidth is the first and only CPaaS provider offering a robust selection of communications APIs built around their own IP voice network.