Reviewing Globe Telecom (OTCMKTS:GTMEF) and Chunghwa Telecom (NYSE:CHT)

Globe Telecom (OTCMKTS:GTMEF) and Chunghwa Telecom (NYSE:CHT) are both communication services companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, valuation, risk, institutional ownership, analyst recommendations, earnings and profitability.

Analyst Ratings

This is a breakdown of recent ratings for Globe Telecom and Chunghwa Telecom, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Globe Telecom	0	0	0	0	0.00
Chunghwa Telecom	1	1	0	0	1.50

Profitability

This table compares Globe Telecom and Chunghwa Telecom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Globe Telecom	N/A	N/A	N/A
Chunghwa Telecom	16.11%	10.00%	7.36%

Dividends

Globe Telecom pays an annual dividend of $55.48 per share and has a dividend yield of 199.6%. Chunghwa Telecom pays an annual dividend of $1.25 per share and has a dividend yield of 2.9%. Globe Telecom pays out 61.8% of its earnings in the form of a dividend. Chunghwa Telecom pays out 75.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Globe Telecom is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Globe Telecom and Chunghwa Telecom”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Globe Telecom	N/A	N/A	N/A	$89.75	0.31
Chunghwa Telecom	$7.58 billion	4.48	$1.23 billion	$1.65	26.56

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

Institutional & Insider Ownership

12.0% of Globe Telecom shares are owned by institutional investors. Comparatively, 2.1% of Chunghwa Telecom shares are owned by institutional investors. 1.0% of Chunghwa Telecom shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Chunghwa Telecom beats Globe Telecom on 7 of the 11 factors compared between the two stocks.

About Globe Telecom

Globe Telecom, Inc. provides telecommunications services to individual customers, small and medium-sized businesses, and corporate and enterprise clients in the Philippines. It operates through Mobile Communications Services and Wireline Communication Services segments. The company offers digital wireless communications services under the Globe Postpaid and Prepaid, and Touch Mobile brands; long distance communication or carrier services; broadband, as well as wireline voice and data communication services; and electronic payment and remittance services under the GCash brand. It provides value-added services, such as inbound and outbound short messaging, content downloading, mobile commerce, and other add-on services. The company also provides human capital management, business process, shared service support, Information technology and electronic, software development, IT system integration and consultancy, and advertising services. In addition, it offers marketing and distribution; data management; data center management; capital investment funds management; warehouse and logistics services; and support and shared services, as well as specific solutions for various industries. The company was incorporated in 1935 and is based in Taguig, the Philippines.

About Chunghwa Telecom

Chunghwa Telecom Co., Ltd., together with its subsidiaries, provides telecommunication services in Taiwan and internationally. It operates through Consumer Business, Enterprise Business, International Business, and Others segments. The company offers local, domestic long distance, and international long distance fixed-line telephone services; mobile services such as prepaid and postpaid plans; broadband plans; and internet and data services. Chunghwa Telecom Co., Ltd. was incorporated in 1996 and is headquartered in Taipei City, Taiwan.