Head-To-Head Survey: Grupo Televisa (NYSE:TV) and Telefonica Brasil (NYSE:VIV)

Grupo Televisa (NYSE:TV) and Telefonica Brasil (NYSE:VIV) are both utilities companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, profitability, dividends, earnings, institutional ownership and risk.

Valuation and Earnings

This table compares Grupo Televisa and Telefonica Brasil”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grupo Televisa	$61.28 billion	0.02	-$453.78 million	($0.80)	-2.69
Telefonica Brasil	$10.36 billion	1.77	$1.03 billion	$0.61	18.22

Telefonica Brasil has lower revenue, but higher earnings than Grupo Televisa. Grupo Televisa is trading at a lower price-to-earnings ratio than Telefonica Brasil, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

55.8% of Grupo Televisa shares are owned by institutional investors. Comparatively, 5.2% of Telefonica Brasil 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 Recommendations

This is a breakdown of current ratings for Grupo Televisa and Telefonica Brasil, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grupo Televisa	0	2	2	0	2.50
Telefonica Brasil	0	2	2	0	2.50

Grupo Televisa presently has a consensus target price of $3.87, indicating a potential upside of 79.43%. Telefonica Brasil has a consensus target price of $13.73, indicating a potential upside of 23.56%. Given Grupo Televisa’s higher probable upside, equities research analysts plainly believe Grupo Televisa is more favorable than Telefonica Brasil.

Profitability

This table compares Grupo Televisa and Telefonica Brasil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grupo Televisa	-13.70%	-6.99%	-3.24%
Telefonica Brasil	10.07%	8.09%	4.48%

Dividends

Grupo Televisa pays an annual dividend of $0.08 per share and has a dividend yield of 3.7%. Telefonica Brasil pays an annual dividend of $0.23 per share and has a dividend yield of 2.1%. Grupo Televisa pays out -10.0% of its earnings in the form of a dividend. Telefonica Brasil pays out 37.7% 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. Grupo Televisa is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Grupo Televisa has a beta of 1.94, suggesting that its stock price is 94% more volatile than the S&P 500. Comparatively, Telefonica Brasil has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500.

Summary

Telefonica Brasil beats Grupo Televisa on 7 of the 13 factors compared between the two stocks.

About Grupo Televisa

Grupo Televisa, S.A.B., together with its subsidiaries, owns and operates cable companies and provides direct-to-home satellite pay television system in Mexico and the United States. It operates through three segments: Cable, Sky, and Other Businesses. The Cable segment operates cable multiple system that provides basic and premium television subscription, pay-per-view, installation, Internet subscription, and telephone and mobile services subscription, as well as local and national advertising services; and telecommunication facilities, which offers data and long-distance services solutions to carriers and other telecommunications service providers through its fiber-optic network. The Sky segment offers direct-to-home broadcast satellite pay television services comprising program, installation, and equipment rental services to subscribers in Mexico, Central America, and the Dominican Republic; and national advertising sales. The Other Businesses segment is involved in the sports and show business promotion, soccer, publishing and publishing distribution, and gaming, as well as provides transmission concessions and facilities. The company was founded in 1969 and is headquartered in Mexico City, Mexico.

About Telefonica Brasil

Telefônica Brasil S.A., together with its subsidiaries, operates as a mobile telecommunications company in Brazil. Its fixed line services portfolio includes local, domestic long-distance, and international long-distance calls; and mobile portfolio comprises voice and broadband internet access through 3G, 4G, 4.5G, and 5G, as well as mobile value-added and wireless roaming services. The company also offers data services, including broadband and mobile data services. In addition, it provides pay TV services through IPTV technologies; network services, such as rental of facilities; other services comprising internet access, private network connectivity, computer equipment leasing, extended service, caller identification, voice mail, cellular blocker, and others; wholesale services, including interconnection services to users of other network providers; and digital services, such as entertainment, cloud, and security and financial services. Further, the company offers multimedia communication services, which include audio, data, voice and other sounds, images, texts, and other information, as well as sells devices, such as smartphones, broadband USB modems, and other devices. Additionally, it provides telecommunications solutions and IT support to various industries, such as retail, manufacturing, services, financial institutions, government, etc. It markets and sells its solutions through own stores, dealers, retail and distribution channels, door-to-door sales, and outbound tele sales. The company was formerly known as Telecomunicações de São Paulo S.A. – TELESP and changed its name to Telefônica Brasil S.A. in October 2011. The company was incorporated in 1998 and is headquartered in São Paulo, Brazil.