Top Communications Stocks for April 2022
The communications sector is composed of a broad range of companies that sell phone and internet services via traditional landline, broadband, or wireless. The communications sector also includes companies that are major creators and producers of movies, television shows, and other content. Well-known companies in the communications sector include Meta Platforms Inc. (formerly Facebook) (FB), Comcast Corp. (CMCSA), and T-Mobile US Inc. (TMUS).
Communications stocks, represented by the benchmark exchange-traded fund (ETF)—the Communication Services Select Sector SPDR ETF (XLC)—have significantly underperformed the broader market as represented by the Russell 1000 Index. XLC has provided a total return of -8.1% over the past 12 months, behind the benchmark Russell 1000 Index’s total return of 13.1%.
Here are the top three communications stocks with the best value, the fastest growth, and the most momentum. The market performance figures above and all statistics in the tables below are as of March 18, 2022.
These are the communications stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows that you’re paying less for each dollar of profit generated.
|Best Value Communications Stocks|
|Price ($)||Market Capitalization (Market Cap) ($B)||12-Month Trailing P/E Ratio|
|Paramount Global (PARA)||37.09||24.1||5.4|
|Altice USA Inc. (ATUS)||11.67||5.3||5.4|
|Lumen Technologies Inc. (LUMN)||11.09||11.4||5.8|
- Paramount Global: Paramount Global is a global media and entertainment company operating in the areas of TV entertainment, cable networks, and filmed entertainment. The company’s businesses include the CBS Television Network, a portfolio of streaming services, Paramount Pictures, Miramax, and other similar ventures. The company was previously ViacomCBS and changed its name to Paramount Global effective Feb. 16, 2022.
- Altice USA Inc.: Altice USA provides digital cable television, high-speed broadband, internet, local news, data, and digital advertising, among other offerings. The company serves customers across the U.S. In March, the company announced 13 new Optimum retail stores across the New York Tri-State area, with new stores already opened or doing so soon in the Bronx, Brooklyn, Connecticut, and Long Island.
- Lumen Technologies Inc.: Lumen Technologies is a communications company that offers a range of integrated services to businesses and consumers. The company integrates network assets, cloud connectivity, security solutions, and voice and collaboration tools into a single platform.
These are the top communications stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year-over-year (YOY) percentage revenue growth and most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore, ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one figure or the other unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of more than 2,500% were excluded as outliers.
|Fastest-Growing Communications Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)||Revenue Growth (%)|
|Liberty Broadband Corp. (LBRDA)||137.20||23.0||46.5||545.6|
|New York Times Co. (NYT)||44.01||7.5||583.3||16.7|
|World Wrestling Entertainment Inc. (WWE)||59.75||4.5||375.0||30.3|
- Liberty Broadband Corp.: Liberty Broadband is a company that invests in communications companies. It holds or has held interests in Charter Communications Inc., Skyhook Holding, and other related companies.
- New York Times Co.: The New York Times Company creates, collects, and distributes news and information. The company operates digital and print platforms and also distributes content on third-party platforms.
- World Wrestling Entertainment Inc.: World Wrestling Entertainment (WWE) is an integrated media and entertainment company. It produces and distributes wrestling entertainment content through video platforms as well as live events. The company also offers a range of branded consumer products. On March 15, the company announced that it had formed a multi-year partnership with INFLCR, a name, image and likeness business management platform for college athletes. The partnership aims to enhance WWE’s capacity to engage student-athletes looking to monetize their name, image, and likeness.
These are the communications stocks that had the highest total return over the past 12 months.
|Communications Stocks With the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|Alphabet Inc. (GOOGL)||2,722.51||1,800||34.7|
|Liberty Formula One Group (FWONA)||54.58||12.7||30.9|
|Live Nation Entertainment Inc. (LYV)||112.98||25.4||28.6|
|Russell 1000 Index||N/A||N/A||13.1|
|The Communication Services Select Sector SPDR ETF (XLC)||N/A||N/A||-8.1|
- Alphabet Inc.: Alphabet is a holding company and the parent company of Google, the world’s largest search engine. Through subsidiaries, the company provides web-based search, maps, software, mobile operating systems, advertisements, consumer content, and more. Note that this listing refers to the company’s Class A shares. On March 8, Alphabet announced plans to acquire cybersecurity company Mandiant Inc. in an all-cash transaction valued at approximately $5.4 billion. Mandiant will join Google Cloud.
- Liberty Formula One Group: Liberty Media Corp. operates businesses across the media, communications, and entertainment industries. The company draws revenue from businesses including Liberty SiriusXM Group, Formula One Group, and The Braves Group.
- Live Nation Entertainment Inc.: Live Nation Entertainment produces live concerts and sells tickets to those events. It provides ticketing services for arenas, stadiums, and professional and college sports teams, among others. For Q4 2021, Live Nation reported narrowing net losses YOY as revenue grew more than 11-fold. Concerts revenue growth led the improvement in this area, with strong growth from the company’s Ticketing and Sponsorship & Advertising businesses as well.
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