Financial Review: Liberty Broadband Corp Series A (LBRDA) versus Liberty Global (LBTYA)

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Liberty Global (NASDAQ:LBTYA) and Liberty Broadband Corp Series A (NASDAQ:LBRDA) are both large-cap consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

21.9% of Liberty Global shares are held by institutional investors. Comparatively, 12.1% of Liberty Broadband Corp Series A shares are held by institutional investors. 5.9% of Liberty Global shares are held by insiders. Comparatively, 5.7% of Liberty Broadband Corp Series A shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Liberty Global and Liberty Broadband Corp Series A’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Liberty Global -11.46% -27.88% -3.31%
Liberty Broadband Corp Series A 9,565.99% 20.10% 17.64%

Valuation and Earnings

This table compares Liberty Global and Liberty Broadband Corp Series A’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Liberty Global $15.05 billion 1.28 -$2.78 billion ($2.29) -10.97
Liberty Broadband Corp Series A $13.09 million 1,137.00 $2.03 billion $11.10 7.39

Liberty Broadband Corp Series A has lower revenue, but higher earnings than Liberty Global. Liberty Global is trading at a lower price-to-earnings ratio than Liberty Broadband Corp Series A, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Liberty Global has a beta of 1.59, indicating that its share price is 59% more volatile than the S&P 500. Comparatively, Liberty Broadband Corp Series A has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Liberty Global and Liberty Broadband Corp Series A, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Liberty Global 2 2 10 0 2.57
Liberty Broadband Corp Series A 0 0 4 0 3.00

Liberty Global presently has a consensus target price of $38.05, indicating a potential upside of 51.47%. Liberty Broadband Corp Series A has a consensus target price of $103.75, indicating a potential upside of 26.42%. Given Liberty Global’s higher possible upside, analysts clearly believe Liberty Global is more favorable than Liberty Broadband Corp Series A.

Summary

Liberty Broadband Corp Series A beats Liberty Global on 8 of the 14 factors compared between the two stocks.

Liberty Global Company Profile

Liberty Global plc, together with its subsidiaries, provides video, broadband Internet, fixed-line telephony, mobile, and other communications services to residential customers and businesses in Europe. It offers video services, including digital video programming and audio services starting with a basic video service, video-on-demand, electronic programming guide, various premium channel packages, digital video recorders, various mobile applications, and set-top boxes. The company provides entertainment, sports, movies, documentaries, lifestyles, news, adult, children, and ethnic and foreign channels. It also offers Wi-Fi and Internet services, such as email, address book, and parental controls; security; online storage solutions and Web spaces; and Connect Box, a connectivity device that delivers in-home Wi-Fi coverage. Additionally, it offers community Wi-Fi via routers in home, which provides access to the Internet; public Wi-Fi access points in train stations, hotels, bars, restaurants, and other public places. In addition, the company provides circuit-switched telephony services; and mobile services comprising voice, short message service, and Internet access. Further, it offers voice, advanced data, video, wireless, cloud-based services, and mobile and converged fixed-mobile services to small or home offices, small businesses, and medium and large enterprises, as well as on a wholesale basis to other operators. Liberty Global plc was founded in 2004 and is based in London, the United Kingdom.

Liberty Broadband Corp Series A Company Profile

Liberty Broadband Corporation, a cable operator, provides video, Internet, and voice services to residential and commercial customers in the United States. It operates through Skyhook and Charter segments. The Skyhook segment offers Precision Location Solution, a location determination service for mobile device makers, wireless carriers, and asset tracking platforms to understanding the precise geographic location and movement of mobile devices; enhancing the location determination capabilities of a hybrid location system. It also provides Geospatial Insights, a location intelligence and data insights service for enterprises, research and consulting firms, financial institutions, and advertisers to understand, measure, and optimize the performance of businesses; benchmark performance against competitors; enhance customer experience; advertise to, and target existing and prospective customers; and measure the efficacy of advertising campaigns in driving real-world actions. The Charter segment offers subscription-based video services comprising video on demand, high definition television, and digital video recorder service; and local and long distance calling, voicemail, call waiting, caller ID, call forwarding, and other voice services, as well as international calling services. It also provides Internet services, which comprises an in-home Wi-Fi product that provides customers with high performance wireless routers; out-of-home Wi-Fi service for Internet customers at designated hot spots; and a security suite that offers protection against computer viruses and spyware. In addition, this segment offers Internet access, data networking, video entertainment, and business telephone services; fiber connectivity to cellular towers and office buildings; and advertising services on cable television networks and digital outlets, as well as regional sports and news networks distribution, and security and home management services. The company is based in Englewood, Colorado.

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