The shares of ViacomCBS (NASDAQ: VIAC) currently trade at $36 per share, which is 6% above its pre-Covid level. On the other hand, shares of Dish Network (NASDAQ: DISH) are trading at $41 per share, which is 12% above its pre-Covid level. Does that make VIAC a better stock pick compared to DISH? Both companies belong to the media industry, with one being a new entrant in streaming and the other focusing on 5G technology. ViacomCBS is a bigger company, with its market cap and revenue base being higher than Dish Network. However, DISH has exhibited much better revenue growth, margin improvement, and a stronger balance sheet. These factors have helped it command a better valuation multiple (P/E) of 9.2x as against 7.6x for VIAC. Dish Network is better placed for further rise considering its latest deal with Amazon Web Service (AWS) for 5G expansion and no exposure to highly affected sectors like theme parks, unlike VIAC. We compare a slew of factors such as historical revenue growth, returns, and valuation multiple in an interactive dashboard analysis, ViacomCBS vs DISH Network: Industry Peers; Which Stock Is A Better Bet?
- Dish Network revenues have demonstrated better growth compared to ViacomCBS over recent years, with Dish revenues expanding more than 3% over the last three years. On the other hand, ViacomCBS revenue declined by 1.5% during this period. If you look at the last twelve months (LTM) period, DISH recorded 41% revenue growth while ViacomCBS’ revenue growth lagged at 4%. Dish Network’s top line benefited from the acquisition of Boost Mobile and Ting Mobile. Whereas, ViacomCBS’ revenues slowed as its studio business was severely affected during the pandemic.
- Dish Network offers pay-TV services, broadband, advertising, digital receivers and related components.
- ViacomCBS generates revenues from cable networks, TV entertainment, and studio business.
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- Though initially VIAC’s profit margins were higher, DISH has overtaken VIAC in terms of profitability in 2019. If you look at the last three years, DISH’s operating profit margins have expanded 1.2% while VIAC’s have shrunk 3.4%.
- Dish’s LTM operating profit margin stood at 20% as against VIAC’s 18%.
- VIAC’s margins are affected by the costs of the merger between CBS and Viacom as well as its studio business being affected during the pandemic. (related: Check out our theme on Value Tech Stocks)
- With respect to debt, Dish Network has a slightly higher debt load. Debt as a percentage of total equity and liabilities stands at 41% in the case of DISH. On the other hand, the metric stands at 32% for VIAC.
- However, as far as liquidity is concerned, Dish is in a better position. Cash as a percentage of total assets is 12% for DISH as against 9.7% for VIAC.
Net of it all
Though VIAC is a bigger company in size, overall Dish Network has exhibited much better revenue and profit margin growth, along with better liquidity. For this, the company has been rewarded, which is reflected in the market return (last three years) for DISH stock which stood at 30%, as against -30% for VIAC stock. Dish Network is likely to showcase better top and bottom line growth in the coming quarters compared to ViacomCBS. This growth will mostly be driven by recent acquisitions and the decision to partner with cloud computing giant Amazon Web Service (AWS) to sell 5G wireless services to businesses. Dish Network plans to connect its 5G network hardware and management software through AWS – the biggest computing service provider. It is also expected that Dish will prioritize its focus on enterprise before consumer retail wireless. This is likely to help Dish tap a wide market in association with Amazon’s AWS as 5G enterprise applications are expected to be used in smart factories, drones, autonomous vehicles, remote health care services, and many more areas.
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