Analyzing Tucows (TCX) and Its Peers

Tucows (NASDAQ: TCX) is one of 50 public companies in the “Internet Services” industry, but how does it weigh in compared to its peers? We will compare Tucows to similar businesses based on the strength of its valuation, dividends, risk, analyst recommendations, earnings, profitability and institutional ownership.

Profitability

This table compares Tucows and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tucows 6.06% 41.65% 6.52%
Tucows Competitors 0.37% 27.20% 6.30%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Tucows and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tucows 0 0 0 0 N/A
Tucows Competitors 440 1690 2625 104 2.49

As a group, “Internet Services” companies have a potential upside of 6.55%. Given Tucows’ peers higher possible upside, analysts clearly believe Tucows has less favorable growth aspects than its peers.

Risk & Volatility

Tucows has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500. Comparatively, Tucows’ peers have a beta of 1.36, suggesting that their average share price is 36% more volatile than the S&P 500.

Institutional and Insider Ownership

43.9% of Tucows shares are held by institutional investors. Comparatively, 62.3% of shares of all “Internet Services” companies are held by institutional investors. 13.2% of Tucows shares are held by insiders. Comparatively, 22.9% of shares of all “Internet Services” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Tucows and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Tucows $251.66 million $29.37 million 35.77
Tucows Competitors $950.86 million $126.85 million 54.27

Tucows’ peers have higher revenue and earnings than Tucows. Tucows is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Tucows peers beat Tucows on 6 of the 10 factors compared.

About Tucows

Tucows Inc. is engaged in providing Internet services. The Company’s segments include Network Access Services and Domain Services. The Network Access Services segment includes mobile, fixed high-speed Internet access services, Internet hosting and network consulting services. The Domain Services segment wholesale and retail domain name registration services, value added services and portfolio services. The Company focuses on serving the needs of this network of resellers by providing services, interfaces, proactive and attentive customer service, reseller-oriented technology and agile design and development processes. The Company focuses its service offerings under brands, including OpenSRS, YummyNames, Platypus, Hover and Ting. As of December 31, 2016, the OpenSRS Domain Service managed 15 million domain names under the Tucows ICANN registrar accreditation and for other registrars. As of December 31, 2016, Ting managed mobile telephony services for approximately 151,000 subscribers.

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