Head-To-Head Review: TIM (NYSE:TIMB) vs. T-Mobile US (NASDAQ:TMUS)

T-Mobile US (NASDAQ:TMUS) and TIM (NYSE:TIMB) are both communication services companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, risk, earnings, dividends, valuation, profitability and analyst recommendations.

Valuation & Earnings

This table compares T-Mobile US and TIM”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
T-Mobile US	$88.31 billion	2.04	$10.99 billion	$10.36	16.40
TIM	$4.77 billion	1.91	$772.28 million	$1.64	11.63

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

Dividends

T-Mobile US pays an annual dividend of $4.08 per share and has a dividend yield of 2.4%. TIM pays an annual dividend of $1.05 per share and has a dividend yield of 5.5%. T-Mobile US pays out 39.4% of its earnings in the form of a dividend. TIM pays out 64.0% 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.

Analyst Recommendations

This is a summary of current ratings and recommmendations for T-Mobile US and TIM, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
T-Mobile US	0	6	20	1	2.81
TIM	0	10	2	0	2.17

T-Mobile US presently has a consensus target price of $235.13, suggesting a potential upside of 38.35%. TIM has a consensus target price of $23.98, suggesting a potential upside of 25.70%. Given T-Mobile US’s stronger consensus rating and higher possible upside, equities analysts clearly believe T-Mobile US is more favorable than TIM.

Volatility and Risk

T-Mobile US has a beta of 0.4, meaning that its share price is 60% less volatile than the S&P 500. Comparatively, TIM has a beta of 0.39, meaning that its share price is 61% less volatile than the S&P 500.

Insider & Institutional Ownership

42.5% of T-Mobile US shares are held by institutional investors. 0.3% of T-Mobile US shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares T-Mobile US and TIM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
T-Mobile US	12.05%	21.47%	5.68%
TIM	14.76%	17.88%	7.64%

Summary

T-Mobile US beats TIM on 14 of the 17 factors compared between the two stocks.

About T-Mobile US

T-Mobile US, Inc. is a wireless communications provider serving consumers, businesses and government customers in the United States. Its services include wireless voice, messaging and data, as well as broadband internet delivered over its wireless network. The company offers service under the T-Mobile and Metro by T-Mobile brands. Its products and services include mobile plans, smartphones and other connected devices, home internet, and solutions for business customers. T-Mobile traces its roots to VoiceStream Wireless, which Deutsche Telekom acquired in 2001.

About TIM

TIM S.A. is a Brazilian telecommunications company that provides mobile voice and data services to consumers and businesses. Its offerings include mobile plans, internet access and digital services, supported by its wireless network. The company also offers fixed broadband services, including fiber-optic internet, under the TIM brand. It serves customers across Brazil, with mobile coverage extending throughout the country. TIM began operating in Brazil in 1998 and has since expanded its network and range of telecommunications services.