Reviewing Freenet (OTCMKTS:FRTAF) & Kyivstar Group (NASDAQ:KYIV)

Kyivstar Group (NASDAQ:KYIV) and Freenet (OTCMKTS:FRTAF) are both mid-cap communication services companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, dividends, analyst recommendations, earnings and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Kyivstar Group and Freenet, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kyivstar Group	0	2	3	0	2.60
Freenet	0	2	1	1	2.75

Kyivstar Group currently has a consensus target price of $16.62, indicating a potential upside of 25.57%. Given Kyivstar Group’s higher possible upside, research analysts clearly believe Kyivstar Group is more favorable than Freenet.

Profitability

This table compares Kyivstar Group and Freenet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kyivstar Group	12.73%	24.71%	15.12%
Freenet	10.04%	17.88%	7.85%

Valuation & Earnings

This table compares Kyivstar Group and Freenet”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kyivstar Group	$1.16 billion	2.64	$124.00 million	$0.66	20.06
Freenet	$2.76 billion	1.16	$306.95 million	$2.56	10.55

Freenet has higher revenue and earnings than Kyivstar Group. Freenet is trading at a lower price-to-earnings ratio than Kyivstar Group, indicating that it is currently the more affordable of the two stocks.

Summary

Kyivstar Group beats Freenet on 7 of the 12 factors compared between the two stocks.

About Kyivstar Group

Kyivstar Group Ltd. provides a range of mobile communication and home Internet services in Ukraine. It offers mobile services, such as voice, messaging and data, mobile and computer Internet, roaming, abroad calling, payment, and other services; fixed telephone communication services; fixed Internet and data transfer services; and mobile virtual PBX services, as well as operates data centers, commercial contact centers, and M2M contact centers. The company also provides loyalty programs, as well as sells telecommunications equipment. The company was founded in 1994 and is based in Dubai, the United Arab Emirates. Kyivstar Group Ltd. operates as a subsidiary of Vimpelcom Amsterdam B.V.

About Freenet

freenet AG provides telecommunications, broadcasting, and multimedia services for mobile communications/mobile internet, and digital lifestyle sectors in Germany. It operates through Mobile Communications, TV and Media, and Other/Holding segments. The Mobile Communications segment engages in the marketing of mobile communications services, which include voice and data services from the mobile network operators; planning, set up, installation, and maintenance services for WiFi networks; and selling and distribution of mobile devices, as well as offers additional services for mobile data communications and digital lifestyle. This segment also provides network-independent services and tariffs; tariffs of the network operators on the basis of the network operator contracts; and freenet Internet, an app-based Internet product. The TV and Media segment is involved in the planning, project management, construction, operation, service, and marketing services for broadcast-related solutions for business clients in the broadcasting and media sectors; and the provision of services to end users in the field of DVB-T2 and IPTV. The Other/Holding segment offers portal services, such as e-commerce/advertising services; payment services; various digital products and entertainment formats for downloading and displaying, as well as use on mobile devices; communication development solutions, IT services, and other services; narrowband voice services; data services; and distribution services. The company provides its services under the klarmobil.de, freenetmobile.de, Dr.SIM, freenet MOBILE, FUNK, freenet FLEX, freenet, freenet TV, waipu.tv, freenet VIDEO, freenet.de, freenet BASICS, freenet ENERGY, freenet BUSINESS, CARMADA, MEDIA BROADCAST, vitrado.de, and The Cloud brands. It sells its products through electronics stores, as well as online sales. freenet AG was incorporated in 2005 and is headquartered in Büdelsdorf, Germany.