Shaw Communications (NYSE: SJR) and j2 Global (NASDAQ:JCOM) are both mid-cap consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, dividends and risk.
Risk and Volatility
Shaw Communications has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500. Comparatively, j2 Global has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500.
This table compares Shaw Communications and j2 Global’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and recommmendations for Shaw Communications and j2 Global, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Shaw Communications currently has a consensus price target of $27.20, indicating a potential upside of 22.63%. j2 Global has a consensus price target of $101.75, indicating a potential upside of 37.87%. Given j2 Global’s stronger consensus rating and higher probable upside, analysts clearly believe j2 Global is more favorable than Shaw Communications.
Earnings and Valuation
This table compares Shaw Communications and j2 Global’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Shaw Communications||$3.70 billion||2.84||$644.63 million||$1.33||16.68|
|j2 Global||$874.26 million||4.09||$152.43 million||$2.70||27.33|
Shaw Communications has higher revenue and earnings than j2 Global. Shaw Communications is trading at a lower price-to-earnings ratio than j2 Global, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
50.9% of Shaw Communications shares are held by institutional investors. 1.0% of Shaw Communications shares are held by company insiders. Comparatively, 5.2% of j2 Global shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Shaw Communications pays an annual dividend of $0.92 per share and has a dividend yield of 4.1%. j2 Global pays an annual dividend of $1.58 per share and has a dividend yield of 2.1%. Shaw Communications pays out 69.2% of its earnings in the form of a dividend. j2 Global pays out 58.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
j2 Global beats Shaw Communications on 9 of the 16 factors compared between the two stocks.
About Shaw Communications
Shaw Communications Inc. (Shaw) is a diversified connectivity provider. The Company operates through four divisions: Consumer, Wireless, Business Network Services and Business Infrastructure Services. Under the Consumer division, the Company offers Cable telecommunications and Satellite video services to residential customers. Its Business Network Services division offers data networking, Cable telecommunications, Satellite video and fleet tracking services to businesses and public sector entities. Its Business Infrastructure Services division offers data center colocation, cloud technology and managed information technology (IT) solutions to businesses. The Company offers wireless services for voice and data communications through its Wireless division. Its wireline services offer approximately 120 high definition (HD) channels and over 10,000 on-demand, pay-per-view and subscription movie and television programming titles.
About j2 Global
j2 Global, Inc. is a provider of services delivered through the Internet. The Company provides cloud services to businesses of all sizes, from individuals to enterprises. The Company operates in two segments: Business Cloud Services and Digital Media. The Company’s Digital Media business segment consists of the Web properties and business operations of Ziff Davis, Inc. (Ziff Davis). The Company’s cloud services and solutions include fax, voice and unified communications, email and customer relationship management, online backup, global network and operations, and customer support services. In February 2013, it acquired IGN Entertainment, Inc. On November 9, 2012, the Company acquired Ziff Davis. Effective March 18, 2013, it acquired MetroFax Inc. In April 2013, the Company acquired Backup Connect BV.
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