Analyzing Quebecor (OTCMKTS:QBCRF) & AT&T (NYSE:T)

AT&T (NYSE:T) and Quebecor (OTCMKTS:QBCRF) are both large-cap communication services companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Dividends

AT&T pays an annual dividend of $1.11 per share and has a dividend yield of 5.2%. Quebecor pays an annual dividend of $1.28 per share and has a dividend yield of 2.6%. AT&T pays out 60.0% of its earnings in the form of a dividend. Quebecor pays out 87.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AT&T is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares AT&T and Quebecor”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AT&T	$125.65 billion	1.14	$21.95 billion	$1.85	11.53
Quebecor	$4.06 billion	2.72	$612.64 million	$1.46	33.80

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

Analyst Ratings

This is a summary of recent recommendations and price targets for AT&T and Quebecor, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AT&T	1	6	12	0	2.58
Quebecor	0	3	3	0	2.50

AT&T presently has a consensus price target of $28.55, indicating a potential upside of 33.83%. Given AT&T’s stronger consensus rating and higher possible upside, equities analysts clearly believe AT&T is more favorable than Quebecor.

Institutional and Insider Ownership

57.1% 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 will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AT&T	10.19%	13.41%	3.92%
Quebecor	16.30%	33.21%	7.17%

Summary

AT&T beats Quebecor on 10 of the 15 factors compared between the two stocks.

About AT&T

AT&T, Inc. is a holding company, which engages in the provision of telecommunications and technology services. It operates through the Communications and Latin America segments. The Communications segment offers wireless, wireline telecom, and broadband services to businesses and consumers located in the US and businesses globally. The Latin America segment provides wireless services and equipment in Mexico. The company was founded in 1983 and is headquartered in Dallas, TX.

About Quebecor

Quebecor Inc., together with its subsidiaries, operates in the telecommunications, media, and sports and entertainment businesses in Canada. The Telecommunications segment offers internet access, television distribution, mobile and wireline telephony, business solutions, and over-the-top video services. The Media segment operates an over-the-air television network and specialty television services; soundstage and equipment rental and postproduction services for the film and television industries; printing, publishing, and distribution of daily newspapers; news and entertainment digital platforms; publishing and distribution of magazines; production and distribution of audiovisual content; and out-of-home advertising business. The Sports and Entertainment segment engages in the operation and management of the Videotron Centre; show production, sporting, and cultural event management; publishing and distribution of books; production of music; and the operation of Quebec Maritimes Junior Hockey League team. The company was incorporated in 1965 and is headquartered in Montreal, Canada. Quebecor Inc. operates as a subsidiary of Les Placements Peladeau, Inc.