Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Telecommunications Services - Integrated industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Telecommunications Services - Integrated Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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6 Undervalued Telecommunications Services - Integrated Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Telecommunications Services - Integrated industry for Tuesday, August 27, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Telecommunications Services - Integrated industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Altice USA Inc’s Value Grade

Value Grade:

Altice USA, Inc. is a broadband communications and video services provider in the United States, delivering broadband, video, mobile, proprietary content and advertising services to residential and business customers across 21 states through its Optimum brand. The Company has presences primarily in the New York metropolitan area and various markets in the south-central United States through a fiber-rich hybrid-fiber coaxial broadband network and a fiber-to-the-home network. The Company offers news programming and advertising services. It operates a4, an advanced advertising and data business, which provides audience-based, multiscreen advertising solutions to local, regional and national businesses and advertising clients. It offers hyper-local, national, international and business news through its News 12 and i24NEWS networks. It also offers managed services, including hosted private branch exchange, managed Wi-Fi and network security for small and medium-sized business customers.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Altice USA Inc has a Value Score of 91, which is considered to be undervalued.

When you look at Altice USA Inc’s price-to-sales ratio at 0.09 compared to the industry median at 1.11, this company has a lower price relative to revenue compared to its peers. This could make Altice USA Inc’s stock more attractive for value investors.

Now, let’s assess Altice USA Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 7.4, when compared to the industry median of 6.3, the company may be considered overvalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Altice USA Inc’s shareholder yield is lower than its industry median ratio of 3.97%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

Lastly, let’s take a look at Altice USA Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Altice USA Inc’s price-to-free-cash-flow ratio is lower than its industry median ratio of 12.04. This could make Altice USA Inc more attractive because the lower P/FCF ratio indicates that Altice USA Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

FullNet Communications Inc’s Value Grade

Value Grade:

FullNet Communications, Inc. is an integrated communications company engaged in providing advanced voice and data solutions. The Company provides a range of mission-critical services to a broad spectrum of customers throughout the world. Its primary services are mass notification services using text messages and automated telephone calls, equipment colocation and related services, and customized live help desk outsourcing service. Its primary advanced voice and data solution is marketed under its CallMultiplier brand name. CallMultiplier is a comprehensive cloud-based solution to consumers and businesses for mass notification services using text messages and automated telephone calls. It provides Internet access services to individual and small business customers located in Oklahoma on a retail basis. Under the FullNet brand, it provides its customers with Internet connectivity as well as direct access to a range of Internet applications and resources, including electronic mail.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

FullNet Communications Inc has a Value Score of 68, which is considered to be undervalued.

FullNet Communications Inc’s price-earnings ratio is 10.1 compared to the industry median at 16.6. This means that it has a lower price relative to its earnings compared to its peers. This makes FullNet Communications Inc more attractive for value investors.

FullNet Communications Inc’s price-to-book ratio is lower than its peers. This could make FullNet Communications Inc more attractive for value investors when compared to the industry median at 1.80.

You can read more about FullNet Communications Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

KT Corp (ADR)’s Value Grade

Value Grade:

KT Corp is a Korea-based company that mainly provides telecommunication services. The Company operates its business through four segments. The Information and Communications Technologies segment is engaged in providing telecommunication services to individual, home, corporate customers and the convergence business. The Finance segment is engaged in providing financial services, such as credit card. The Satellite Broadcasting segment provides satellite television services. The Other segment includes security services, satellite service, information technology and network services, as well as global business services, which provide global network services to multinational or domestic corporate customers and telecommunications companies. The Company's principal services include mobile voice and data telecommunications services; fixed-line services; credit card processing and other financial services; as well as other services. The Company is engaged in the software platforms business.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

KT Corp (ADR) has a Value Score of 99, which is considered to be undervalued.

KT Corp (ADR)’s price-earnings ratio is 9.0 compared to the industry median at 16.6. This means that it has a lower price relative to its earnings compared to its peers. This makes KT Corp (ADR) more attractive for value investors.

KT Corp (ADR)’s price-to-book ratio is higher than its peers. This could make KT Corp (ADR) less attractive for value investors when compared to the industry median at 1.80.

You can read more about KT Corp (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Liberty Global Ltd’s Value Grade

Value Grade:

Liberty Global Ltd. is an international fixed-mobile convergence (FMC) communications company. The Company is engaged in providing connectivity and entertainment services to its residential and business customers. It delivers next-generation products through advanced fiber and 5G networks and provides connections across Europe. The Company’s businesses operate under some of the consumer brands, including Sunrise in Switzerland, Telenet in Belgium, Virgin Media in Ireland, UPC in Slovakia, Virgin Media-O2 in the United Kingdom, and VodafoneZiggo in the Netherlands. The Company, through its global investment arm, Liberty Global Ventures, has a portfolio of more than 75 companies and funds across the content, technology, and infrastructure industries, including stakes in companies like ITV, Televisa Univision, Plume, AtlasEdge and the Formula E racing series. Its products and services include Wi-Fi and Internet services, video, mobile and telephony services.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Liberty Global Ltd has a Value Score of 92, which is considered to be undervalued.

Liberty Global Ltd’s price-to-book ratio is higher than its peers. This could make Liberty Global Ltd less attractive for value investors when compared to the industry median at 1.80.

You can read more about Liberty Global Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

LICT Corp’s Value Grade

Value Grade:

LICT Corporation, together with its subsidiaries, is an integrated provider of broadband and voice services. The Company, through its subsidiaries, operates in rural communities, providing regulated and unregulated communications services, including local telephone service, network access, transport, high-speed Internet access, long-distance service, cable television, and competitive local exchange carrier (CLEC) services. The Company provides high-speed broadband services, including Internet access, through copper-based digital subscriber lines (DSL), fiber optic facilities, fixed wireless, and cable modems. It also provides video services through both traditional cable television services (CATV) and Internet protocol television services (IPTV); Voice over Internet Protocol (VoIP); wireless voice communications, and several other related services. The Company provides its array of communications services to residential, commercial, and governmental customers.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

LICT Corp has a Value Score of 67, which is considered to be undervalued.

LICT Corp’s price-earnings ratio is 19.6 compared to the industry median at 16.6. This means that it has a higher price relative to its earnings compared to its peers. This makes LICT Corp less attractive for value investors.

LICT Corp’s price-to-book ratio is higher than its peers. This could make LICT Corp less attractive for value investors when compared to the industry median at 1.80.

You can read more about LICT Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Telefonica Brasil SA (ADR)’s Value Grade

Value Grade:

Telefonica Brasil S.A. is a mobile telecommunications company in Brazil offering postpaid mobile services. The Company also operates as a fixed telecommunications company in the state of Sao Paulo. The Company markets its mobile services under its Vivo brand. It offers its clients a portfolio of products, including mobile and fixed voice, mobile data, fixed broadband, ultra-fast broadband, Pay television, information technology and digital services. Its operations consist of local and long distance fixed telephone services; mobile services, including value-added services; data services, including broadband services and mobile data services; Pay television services through direct to home (DTH), Internet protocol television (IPTV) and cable; network services, such as rental of facilities, as well as other services; wholesale services, including interconnection; digital services; services designed specifically for corporate customers, and the sale of wireless devices and accessories.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Telefonica Brasil SA (ADR) has a Value Score of 80, which is considered to be undervalued.

Telefonica Brasil SA (ADR)’s price-earnings ratio is 16.6 compared to the industry median at 16.6. This means that it has a higher price relative to its earnings compared to its peers. This makes Telefonica Brasil SA (ADR) fairly attractive for value investors.

Telefonica Brasil SA (ADR)’s price-to-book ratio is higher than its peers. This could make Telefonica Brasil SA (ADR) less attractive for value investors when compared to the industry median at 1.80.

You can read more about Telefonica Brasil SA (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Telecommunications Services - Integrated Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Telecommunications Services - Integrated stocks as well as other industrys.

Choosing Which of the 6 Best Telecommunications Services - Integrated Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Altice USA Inc stock has a Value Grade of A.
• FullNet Communications Inc stock has a Value Grade of B.
• KT Corp (ADR) stock has a Value Grade of A.
• Liberty Global Ltd stock has a Value Grade of A.
• LICT Corp stock has a Value Grade of B.
• Telefonica Brasil SA (ADR) stock has a Value Grade of B.

Now that you have a bit more background about each of the 6 undervalued stocks in the Telecommunications Services - Integrated industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Telecommunications Services - Integrated Stocks

Want to learn more about Telecommunications Services - Integrated stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 6 Undervalued Telecommunications Services - Integrated Stocks for Tuesday, August 27
• 6 Undervalued Telecommunications Services - Integrated Stocks for Monday, August 26
• 6 Undervalued Telecommunications Services - Integrated Stocks for Friday, August 23
• 4 Undervalued Telecommunications Services - Integrated Stocks for Thursday, August 22

AAII Disclaimer

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