Head-To-Head Review: Cellcom Israel (CEL) & United States Cellular (USM)

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

Valuation and Earnings

This table compares Cellcom Israel and United States Cellular’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cellcom Israel $1.05 billion 1.00 $39.00 million $0.32 32.44
United States Cellular $3.94 billion 0.80 $48.00 million ($3.13) -11.82

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

Volatility and Risk

Cellcom Israel has a beta of 2.07, meaning that its share price is 107% more volatile than the S&P 500. Comparatively, United States Cellular has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500.

Insider & Institutional Ownership

7.0% of Cellcom Israel shares are held by institutional investors. Comparatively, 14.8% of United States Cellular shares are held by institutional investors. 1.6% of United States Cellular shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Cellcom Israel and United States Cellular’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cellcom Israel 3.08% 8.63% 1.90%
United States Cellular -6.93% 0.94% 0.49%

Analyst Ratings

This is a breakdown of recent recommendations for Cellcom Israel and United States Cellular, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cellcom Israel 1 1 0 0 1.50
United States Cellular 1 1 0 0 1.50

United States Cellular has a consensus target price of $30.00, indicating a potential downside of 18.94%. Given United States Cellular’s higher possible upside, analysts plainly believe United States Cellular is more favorable than Cellcom Israel.

Summary

Cellcom Israel beats United States Cellular on 7 of the 12 factors compared between the two stocks.

Cellcom Israel Company Profile

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.

United States Cellular Company Profile

United States Cellular Corporation (U.S. Cellular) is a provider of wireless telecommunication services. The Company’s wireless operating markets are in the United States. U.S. Cellular provides service to postpaid and prepaid customers from a range of demographic segments. The Company focuses on retail consumers, government and small-to-mid-size business customers in industries, such as construction, retail, professional services and real estate. The Company offers a range of wireless devices, such as handsets, modems, mobile hotspots, home phones and tablets for use by its customers. U.S. Cellular offers wireless devices that are compatible with fourth generation long term evolution (4G LTE) and third generation (3G) networks. U.S. Cellular offers a range of accessories, such as carrying cases, hands-free devices, batteries, battery chargers, and memory cards to related consumer electronics, such as headphones, speakers and Bluetooth keyboards.

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