Head to Head Analysis: Spok (NASDAQ:SPOK) & KDDI (OTCMKTS:KDDIY)

KDDI (OTCMKTS:KDDIY) and Spok (NASDAQ:SPOK) are both communication services companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Profitability

This table compares KDDI and Spok’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KDDI	N/A	N/A	N/A
Spok	9.00%	8.50%	6.08%

Volatility & Risk

KDDI has a beta of 0.05, meaning that its stock price is 95% less volatile than the S&P 500. Comparatively, Spok has a beta of 0.48, meaning that its stock price is 52% less volatile than the S&P 500.

Insider & Institutional Ownership

0.1% of KDDI shares are owned by institutional investors. Comparatively, 50.8% of Spok shares are owned by institutional investors. 7.3% of Spok shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares KDDI and Spok”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KDDI	$40.34 billion	1.77	$4.67 billion	$1.26	14.12
Spok	$139.71 million	1.71	$15.88 million	$0.58	19.72

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

Analyst Ratings

This is a breakdown of current ratings for KDDI and Spok, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KDDI	1	0	0	1	2.50
Spok	0	2	0	0	2.00

Spok has a consensus price target of $14.00, suggesting a potential upside of 22.38%. Given Spok’s higher probable upside, analysts plainly believe Spok is more favorable than KDDI.

Dividends

KDDI pays an annual dividend of $0.30 per share and has a dividend yield of 1.7%. Spok pays an annual dividend of $1.25 per share and has a dividend yield of 10.9%. KDDI pays out 23.8% of its earnings in the form of a dividend. Spok pays out 215.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Spok beats KDDI on 9 of the 16 factors compared between the two stocks.

About KDDI

KDDI Corporation provides telecommunications services in Japan and internationally. It operates in two segments, Personal Services and Business Services. The Personal Services segment offers telecommunication services and other services such as finance, energy, and LX through its multi-brands au, UQ mobile, and povo. The Business Services segment offers smartphones and other devices, network and cloud services, and data center services to corporate customers under the TELEHOUSE brand. The company was incorporated in 1984 and is headquartered in Tokyo, Japan.

About Spok

Spok Holdings, Inc., through its subsidiary, Spok, Inc., provides healthcare communication solutions in the United States, Europe, Canada, Australia, Asia, and the Middle East. The company's products and services enhance workflows for clinicians and support administrative compliance. It delivers clinical information to care teams when and where it matters to enhance patient outcomes; and provides GenA Pager, a one-way alphanumeric pager. The company offers subscriptions to one-way or two-way messaging services, as well as alphanumeric pagers that are configurable to support unencrypted or encrypted operation; and ancillary services, such as voicemail, and equipment loss or maintenance protection services, as well as sells devices to resellers who lease or resell them to their subscribers. Its Spok Care Connect suite products for contact centers, clinical alerting and notification, mobile communications and messaging, and public safety notifications. In addition, the company provides professional, software license updates, and product support services, as well as sells third-party equipment. It serves businesses, professionals, management personnel, medical personnel, field sales personnel and service forces, members of the construction industry and construction trades, real estate brokers and developers, sales and services organizations, specialty trade organizations, manufacturing organizations, and government agencies. The company was formerly known as USA Mobility, Inc. and changed its name to Spok Holdings, Inc. in July 2014. Spok Holdings, Inc. was founded in 1986 and is headquartered in Alexandria, Virginia.