In the telecommunications industry, there's one stock to suit every investor. Here's 3 of the best on offer today!
Value
M2 Group (ASX: MTU) is the owner of brands such as Primus, Dodo, Eftel and Commander. Despite growing earnings at an incredible 5-year average of 33.1%, it currently trades on a forward price to earnings ratio of just 11! With a forecast dividend yield of 4.4%, investors have been unreasonably bearish on the stock. Although its debt to equity ratio has climbed to 110%, it's for the right reason: acquisitions. Recently management announced debt would fall quicker than expected and they would again look to acquire businesses to grow their customer base. They singled out energy as a key market for consolidation.
Growth
Currently trading on a price to earnings ratio of 39 and a price to book ratio of 4.83, you be forgiven for believing Vocus Communications (ASX: VOC) is overvalued. Vocus provides infrastructure heavy communications networks which span between a number of countries and provide high performance, availability and scalability. Its track record for growth is extremely impressive with both revenue and underlying EBITDA notching up a compound annual growth rate (CAGR) above 50%. In the most recent half-year, Vocus grew underlying earnings 52%.
Income
No surprises here. Telstra Corporation (ASX: TLS) is still one of the most reliable dividend payers on the S&P/ASX200 (ASX: XJO) (^AXJO). Its current forecast dividend yield for FY14 is 5.5% plus franking. However Telstra is not void of a growth. Its International and Network Application Services (NAS) divisions both grew sales by nearly 30% in the first half of 2014 – quite impressive for a company with a market capitalisation of over $64 billion! What's more, management have been active in divesting non-core assets and have hinted they may even return excess funds to shareholders.
