Cellcom Israel (CEL) & AT&T (NYSE:T) Head to Head Review

Cellcom Israel (NYSE: CEL) and AT&T (NYSE:T) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, risk, profitabiliy, valuation and earnings.

Insider & Institutional Ownership

6.2% of Cellcom Israel shares are held by institutional investors. Comparatively, 55.3% of AT&T shares are held by institutional investors. 0.1% of AT&T shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Cellcom Israel and AT&T’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Cellcom Israel $1.11 billion 0.84 $210.05 million $0.32 29.06
AT&T $161.93 billion 1.45 $49.37 billion $2.12 18.09

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

Profitability

This table compares Cellcom Israel and AT&T’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cellcom Israel 3.12% 8.94% 1.90%
AT&T 8.12% 14.53% 4.43%

Risk & Volatility

Cellcom Israel has a beta of 2.11, suggesting that its share price is 111% more volatile than the S&P 500. Comparatively, AT&T has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Cellcom Israel and AT&T, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cellcom Israel 1 1 0 0 1.50
AT&T 0 17 10 0 2.37

AT&T has a consensus target price of $43.75, suggesting a potential upside of 14.05%. Given AT&T’s stronger consensus rating and higher probable upside, analysts clearly believe AT&T is more favorable than Cellcom Israel.

Dividends

AT&T pays an annual dividend of $1.96 per share and has a dividend yield of 5.1%. Cellcom Israel does not pay a dividend. AT&T pays out 92.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cellcom Israel has increased its dividend for 32 consecutive years.

Summary

AT&T beats Cellcom Israel on 13 of the 17 factors compared between the two stocks.

About Cellcom Israel

Cellcom Israel Ltd. is engaged in the provision of cellular telephone services. The Company offers fixed-line services. The Company operates in two segments: Cellular and Fixed-line. The cellular segment includes the cellular communications services, end user cellular equipment and supplemental services. The fixed-line segment includes landline and long distance telephony services, Internet infrastructure and connectivity services, television services, end user fixed-line equipment and supplemental services. The Company provides a range of cellular services through its second generation (2G), third generation (3G) and fourth generation (4G) network. The Company’s services include basic cellular telephony services, text and multimedia messaging, advanced cellular content and data services, and other value-added services. It also offers international roaming services, a range of handsets from various manufacturers, and repair services on most handsets it offers.

About AT&T

AT&T Inc. is a holding company. The Company is a provider of communications and digital entertainment services in the United States and the world. The Company operates through four segments: Business Solutions, Entertainment Group, Consumer Mobility and International. The Company offers its services and products to consumers in the United States, Mexico and Latin America and to businesses and other providers of telecommunications services worldwide. It also owns and operates three regional TV sports networks, and retains non-controlling interests in another regional sports network and a network dedicated to game-related programming, as well as Internet interactive game playing. Its services and products include wireless communications, data/broadband and Internet services, digital video services, local and long-distance telephone services, telecommunications equipment, managed networking, and wholesale services. Its subsidiaries include AT&T Mobility and SKY Brasil Servicos Ltda.

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