Head-To-Head Contrast: AT&T (T) & ORBCOMM (ORBC)

AT&T (NYSE: T) and ORBCOMM (NASDAQ:ORBC) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Profitability

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

Net Margins Return on Equity Return on Assets
AT&T 8.12% 14.53% 4.43%
ORBCOMM -15.52% -6.16% -3.25%

Volatility & Risk

AT&T has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, ORBCOMM has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for AT&T and ORBCOMM, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AT&T 0 16 10 0 2.38
ORBCOMM 0 0 6 0 3.00

AT&T currently has a consensus price target of $44.10, suggesting a potential upside of 14.28%. ORBCOMM has a consensus price target of $13.30, suggesting a potential upside of 13.58%. Given AT&T’s higher probable upside, analysts plainly believe AT&T is more favorable than ORBCOMM.

Dividends

AT&T pays an annual dividend of $1.96 per share and has a dividend yield of 5.1%. ORBCOMM 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. ORBCOMM has increased its dividend for 32 consecutive years.

Institutional and Insider Ownership

55.0% of AT&T shares are held by institutional investors. Comparatively, 77.2% of ORBCOMM shares are held by institutional investors. 0.1% of AT&T shares are held by insiders. Comparatively, 9.5% of ORBCOMM 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 AT&T and ORBCOMM’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AT&T $161.93 billion 1.46 $49.37 billion $2.12 18.20
ORBCOMM $202.00 million 4.26 $36.94 million ($0.45) -26.02

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

Summary

AT&T beats ORBCOMM on 9 of the 16 factors compared between the two stocks.

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.

About ORBCOMM

ORBCOMM Inc. is a provider of Internet of Things (IoT) solutions, including network connectivity, devices, device management and Web reporting applications. The Company’s IoT products and services are designed to track, monitor and manage security for a range of assets, such as trailers, trucks, rail cars, sea containers, generators, fluid tanks, marine vessels, diesel or electric powered generators (gensets), oil and gas wells, pipeline monitoring equipment, irrigation control systems, and utility meters, in industries for transportation and supply chain, heavy equipment, fixed asset monitoring, maritime and government. It also provides Automatic Identification System (AIS) data services to assist in vessel navigation and to manage maritime safety for government and commercial customers across the world. It provides its services using various network platforms, including its own constellation of low-Earth orbit (LEO) satellites.

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