Critical Analysis: Neustar (NSR) versus KT Corporation (KT)

Neustar (NYSE: NSR) and KT Corporation (NYSE:KT) are both telecommunications services companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, valuation, profitability, institutional ownership, risk and earnings.

Analyst Recommendations

This is a breakdown of current ratings for Neustar and KT Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Neustar 0 3 0 0 2.00
KT Corporation 0 0 1 0 3.00

Neustar presently has a consensus target price of $29.50, indicating a potential downside of 11.94%. Given Neustar’s higher probable upside, equities analysts clearly believe Neustar is more favorable than KT Corporation.

Risk and Volatility

Neustar has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500. Comparatively, KT Corporation has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.

Insider & Institutional Ownership

88.8% of Neustar shares are held by institutional investors. Comparatively, 24.1% of KT Corporation shares are held by institutional investors. 2.9% of Neustar shares are held by insiders. Comparatively, 1.0% of KT Corporation shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Neustar and KT Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Neustar N/A N/A N/A $3.27 10.24
KT Corporation $20.46 billion 0.39 $3.91 billion N/A N/A

KT Corporation has higher revenue and earnings than Neustar.

Profitability

This table compares Neustar and KT Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Neustar 15.50% 19.28% 8.80%
KT Corporation 3.06% 6.55% 2.76%

Summary

Neustar beats KT Corporation on 7 of the 10 factors compared between the two stocks.

About Neustar

NeuStar, Inc. is a global information services provider. The Company’s cloud-based platforms and differentiated data sets offer informative, real-time analytics, which enable clients to make actionable, data-driven decisions. It provides chief marketing officers a suite of services to plan their media spends, identify and locate desired customers, invest in marketing campaigns, deliver relevant offers and measure the performance of these activities. Security professionals use the Company’s solutions to maximize Web performance and protect against malicious attacks. It enables the exchange of essential operating information across multiple carriers to provision and manage services, assisting clients with order processing and routing of customer inquiries. The Company’s services include marketing services, security services, data services and number portability administration center (NPAC) services.

About KT Corporation

KT Corporation is a telecommunications service provider. The Company’s segments include the Customer/Marketing Group, the Finance Business Group and the Others Group. The Customer/Marketing Group segment is engaged in providing various telecommunication services to individual/home/corporate customers and the convergence business. The Finance Business Group segment is engaged in providing various financial services, such as credit card. The Others Group segment includes security services, satellite service, information technology and network services, and satellite television services, as well as global business services, which provide global network services to multinational or domestic corporate customers and telecommunications companies. The Company’s principal services include mobile voice and data telecommunications services; fixed-line services; credit card processing and other financial services, and various other services.

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