Head to Head Survey: Freenet (OTCMKTS:FRTAF) versus VEON (NASDAQ:VEON)

VEON (NASDAQ:VEON) and Freenet (OTCMKTS:FRTAF) are both mid-cap communication services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, profitability, earnings, dividends and valuation.

Volatility and Risk

VEON has a beta of 1.65, indicating that its stock price is 65% more volatile than the S&P 500. Comparatively, Freenet has a beta of -0.01, indicating that its stock price is 101% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for VEON and Freenet, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
VEON	0	2	3	0	2.60
Freenet	0	2	1	1	2.75

VEON currently has a consensus target price of $72.00, indicating a potential upside of 25.26%. Given VEON’s higher possible upside, analysts clearly believe VEON is more favorable than Freenet.

Insider and Institutional Ownership

21.3% of VEON shares are owned by institutional investors. 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.

Profitability

This table compares VEON and Freenet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
VEON	1.24%	14.93%	2.78%
Freenet	10.04%	17.88%	7.85%

Earnings & Valuation

This table compares VEON and Freenet”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
VEON	$4.40 billion	0.97	$532.00 million	$0.85	67.62
Freenet	$2.76 billion	1.16	$306.95 million	$2.56	10.55

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

About VEON

VEON Ltd., a digital operator, provides connectivity and internet services in Pakistan, Ukraine, Kazakhstan, Bangladesh, Uzbekistan, and Kyrgyzstan. It offers mobile telecommunications services, including value added and call completion, national and international roaming, wireless Internet access, mobile financial, and mobile bundle services; data connectivity, cross border transit, voice, Internet, and data services; fixed-line telecommunications using intercity fiber optic networks; and Internet-TV using Fiber to the building technology. The company also sells equipment, infrastructure, and accessories. VEON Ltd. was founded in 1992 and is headquartered in Amsterdam, the Netherlands.

About Freenet

freenet AG provides telecommunications, broadcasting, and multimedia services for mobile communications/mobile internet, and digital lifestyle sectors in Germany. It operates through Mobile Communications, TV and Media, and Other/Holding segments. The Mobile Communications segment engages in the marketing of mobile communications services, which include voice and data services from the mobile network operators; planning, set up, installation, and maintenance services for WiFi networks; and selling and distribution of mobile devices, as well as offers additional services for mobile data communications and digital lifestyle. This segment also provides network-independent services and tariffs; tariffs of the network operators on the basis of the network operator contracts; and freenet Internet, an app-based Internet product. The TV and Media segment is involved in the planning, project management, construction, operation, service, and marketing services for broadcast-related solutions for business clients in the broadcasting and media sectors; and the provision of services to end users in the field of DVB-T2 and IPTV. The Other/Holding segment offers portal services, such as e-commerce/advertising services; payment services; various digital products and entertainment formats for downloading and displaying, as well as use on mobile devices; communication development solutions, IT services, and other services; narrowband voice services; data services; and distribution services. The company provides its services under the klarmobil.de, freenetmobile.de, Dr.SIM, freenet MOBILE, FUNK, freenet FLEX, freenet, freenet TV, waipu.tv, freenet VIDEO, freenet.de, freenet BASICS, freenet ENERGY, freenet BUSINESS, CARMADA, MEDIA BROADCAST, vitrado.de, and The Cloud brands. It sells its products through electronics stores, as well as online sales. freenet AG was incorporated in 2005 and is headquartered in Büdelsdorf, Germany.