Analyzing China Telecom (NYSE:CHA) and Crexendo (NYSE:CXDO)

Crexendo (OTCMKTS:CXDO) and China Telecom (NYSE:CHA) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, earnings, valuation and risk.

Profitability

This table compares Crexendo and China Telecom’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Crexendo 6.54% 34.90% 15.59%
China Telecom N/A N/A N/A

Analyst Recommendations

This is a summary of current ratings for Crexendo and China Telecom, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Crexendo 0 0 0 0 N/A
China Telecom 1 0 3 0 2.50

China Telecom has a consensus target price of $53.90, suggesting a potential upside of 42.25%. Given China Telecom’s higher possible upside, analysts clearly believe China Telecom is more favorable than Crexendo.

Earnings & Valuation

This table compares Crexendo and China Telecom’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Crexendo $11.91 million 5.30 -$220,000.00 N/A N/A
China Telecom $54.85 billion 0.56 $3.20 billion $3.81 9.94

China Telecom has higher revenue and earnings than Crexendo.

Volatility and Risk

Crexendo has a beta of 2.35, suggesting that its share price is 135% more volatile than the S&P 500. Comparatively, China Telecom has a beta of 0.73, suggesting that its share price is 27% less volatile than the S&P 500.

Insider and Institutional Ownership

0.2% of Crexendo shares are owned by institutional investors. Comparatively, 0.5% of China Telecom shares are owned by institutional investors. 78.0% of Crexendo shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

China Telecom pays an annual dividend of $1.44 per share and has a dividend yield of 3.8%. Crexendo does not pay a dividend. China Telecom pays out 37.8% of its earnings in the form of a dividend.

Summary

Crexendo beats China Telecom on 7 of the 13 factors compared between the two stocks.

Crexendo Company Profile

Crexendo, Inc. provides unified communications cloud telecom, broadband Internet, and other cloud business services for businesses in North America and internationally. The company operates in two segments, Cloud Telecommunications and Web Services. The Cloud Telecommunications segment provides telecommunications services that transmit calls using IP or cloud technology, which converts voice signals into digital data packets for transmission over the Internet or cloud; and broadband Internet services. This segment is also involved in the sale and lease of cloud telecommunications equipment. It offers hardware, software, and unified communication solutions for businesses using IP or cloud technology over high-speed Internet connection through various devices and user interfaces, such as desktop phones, and/or mobile and desktop applications. The Web Services segment provides Website hosting and other professional services. The company was formerly known as iMergent, Inc. and changed its name to Crexendo, Inc. in May 2011. Crexendo, Inc. was founded in 1995 and is headquartered in Tempe, Arizona.

China Telecom Company Profile

China Telecom Corporation Limited, together with its subsidiaries, provides wireline and mobile telecommunications services primarily in the People's Republic of China. It offers wireline voice services, including local wireline telephone services and long distance wireline services; CDMA mobile voice services, such as local calls, domestic and international long distance calls, intra-provincial roaming, and inter-provincial roaming and international roaming; wireline Internet access services comprising dial-up and broadband services; wireless Internet access services; and wireline, Internet, and mobile value-added services. The company also provides Best Tone information services; and information technology-based integrated solutions, such as system integration, outsourcing, special advisory, information application, knowledge, and software development services. In addition, it offers managed data services that include digital data network, frame relay, and asynchronous transfer mode services for government agencies, large corporations, and institutions; and leased line services, as well as sells, repairs, and maintains customer-end equipment. Further, the company provides international telecommunications services, including network equipment, international Internet access and transit, Internet data center, and mobile virtual network services in various countries, including the Asia Pacific, Europe, Africa, South America, and North America; and music production and related information, instant messenger, and e-commerce services, as well as sells telecommunications terminals. As of December 31, 2018, it had approximately 303 million mobile subscribers; 146 million wireline broadband subscribers; and 116 million access lines in service. The company was incorporated in 2002 and is based in Wanchai, Hong Kong. China Telecom Corporation Limited is a subsidiary of China Telecommunications Corporation.

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