NYSE:TDS

Stock Analysis Report

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Telephone and Data Systems

Executive Summary

Telephone and Data Systems, Inc., a telecommunications company, provides communications services in the United States.


Snowflake Analysis

Established dividend payer and good value.

Share Price & News

How has Telephone and Data Systems's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TDS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

2.2%

TDS

2.4%

US Wireless Telecom

2.9%

US Market


1 Year Return

-30.6%

TDS

21.8%

US Wireless Telecom

8.9%

US Market

Return vs Industry: TDS underperformed the US Wireless Telecom industry which returned 21.8% over the past year.

Return vs Market: TDS underperformed the US Market which returned 8.9% over the past year.


Shareholder returns

TDSIndustryMarket
7 Day2.2%2.4%2.9%
30 Day22.3%13.5%10.6%
90 Day7.8%11.1%5.1%
1 Year-28.6%-30.6%23.3%21.8%11.4%8.9%
3 Year-20.4%-26.0%37.2%32.0%34.3%25.4%
5 Year-22.5%-30.6%99.3%82.1%60.7%42.7%

Price Volatility Vs. Market

How volatile is Telephone and Data Systems's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Telephone and Data Systems undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TDS ($20.95) is trading below our estimate of fair value ($130.69)

Significantly Below Fair Value: TDS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TDS is good value based on its PE Ratio (18.3x) compared to the Wireless Telecom industry average (19.6x).

PE vs Market: TDS is poor value based on its PE Ratio (18.3x) compared to the US market (16.4x).


Price to Earnings Growth Ratio

PEG Ratio: TDS's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: TDS is good value based on its PB Ratio (0.5x) compared to the US Wireless Telecom industry average (3.6x).


Next Steps

Future Growth

How is Telephone and Data Systems forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

-12.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TDS's earnings are forecast to decline over the next 3 years (-12.2% per year).

Earnings vs Market: TDS's earnings are forecast to decline over the next 3 years (-12.2% per year).

High Growth Earnings: TDS's earnings are forecast to decline over the next 3 years.

Revenue vs Market: TDS's revenue (2.5% per year) is forecast to grow slower than the US market (8.8% per year).

High Growth Revenue: TDS's revenue (2.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TDS's Return on Equity is forecast to be low in 3 years time (3.3%).


Next Steps

Past Performance

How has Telephone and Data Systems performed over the past 5 years?

15.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TDS has high quality earnings.

Growing Profit Margin: TDS's current net profit margins (2.5%) are lower than last year (3%).


Past Earnings Growth Analysis

Earnings Trend: TDS has become profitable over the past 5 years, growing earnings by 15.6% per year.

Accelerating Growth: TDS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TDS had negative earnings growth (-15.5%) over the past year, making it difficult to compare to the Wireless Telecom industry average (-9.3%).


Return on Equity

High ROE: TDS's Return on Equity (2.9%) is considered low.


Next Steps

Financial Health

How is Telephone and Data Systems's financial position?


Financial Position Analysis

Short Term Liabilities: TDS's short term assets ($2.0B) exceed its short term liabilities ($900.0M).

Long Term Liabilities: TDS's short term assets ($2.0B) do not cover its long term liabilities ($4.5B).


Debt to Equity History and Analysis

Debt Level: TDS's debt to equity ratio (43.5%) is considered high.

Reducing Debt: TDS's debt to equity ratio has increased from 43% to 43.5% over the past 5 years.

Debt Coverage: TDS's debt is well covered by operating cash flow (44.5%).

Interest Coverage: TDS's interest payments on its debt are not well covered by EBIT (1.4x coverage).


Balance Sheet


Next Steps

Dividend

What is Telephone and Data Systems's current dividend yield, its reliability and sustainability?

3.25%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: TDS's dividend (3.25%) is higher than the bottom 25% of dividend payers in the US market (1.62%).

High Dividend: TDS's dividend (3.25%) is low compared to the top 25% of dividend payers in the US market (4.32%).


Stability and Growth of Payments

Stable Dividend: TDS's dividends per share have been stable in the past 10 years.

Growing Dividend: TDS's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (58%), TDS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TDS's dividends in 3 years are forecast to be covered by earnings (51.3% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.3yrs

Average management tenure


CEO

Ted Carlson (72yo)

34.42yrs

Tenure

US$6,885,781

Compensation

Mr. LeRoy T. Carlson, Jr., also known as Ted, as a Director of United States Cellular Corporation (“U.S. Cellular”) since 1984. Mr. Carlson has been the Chairman (an Executive Officer) of U.S. Cellular sin ...


CEO Compensation Analysis

Compensation vs Market: Ted's total compensation ($USD6.89M) is above average for companies of similar size in the US market ($USD4.72M).

Compensation vs Earnings: Ted's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
LeRoy Carlson
President34.42yrsUS$6.89m3.73% $89.6m
Peter Sereda
Executive VP & CFO1yrUS$1.92m0.026% $629.1k
Scott Williamson
Senior Vice President of Acquisitions & Corporate Development22.33yrsUS$2.31m0.046% $1.1m
Anita Kroll
Chief Accounting Officer1yrno data0.0013% $31.7k
Joseph Hanley
Senior Vice President of Technology8.25yrsno data0.020% $472.2k
Kurt Thaus
Chief Information Officer & Senior VP16.42yrsno data0.019% $462.8k
Julie Mathews
Director of Investor Relationsno datano datano data
Stephen Fitzell
General Counsel & Assistant Secretaryno datano datano data
Daniel DeWitt
Senior Vice President of Human Resources3.42yrsno datano data
Theodore Wiessing
Chief Security & Privacy Officer and VP of IT Operational Servicesno datano datano data

8.3yrs

Average Tenure

63.5yo

Average Age

Experienced Management: TDS's management team is seasoned and experienced (8.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
LeRoy Carlson
President34.42yrsUS$6.89m3.73% $89.6m
Gary Sugarman
Independent Director11.08yrsUS$206.36k0.031% $752.9k
Christopher O'Leary
Independent Director14.42yrsUS$241.86k0.035% $841.4k
Kenneth Meyers
Non-Independent Director13.42yrsUS$8.84m0.034% $824.1k
Letitia G. Carlson
Non-Independent Director24.42yrsUS$188.86k2.75% $66.0m
Walter C. Carlson
Chairman of the Board18.42yrsUS$227.61k3.11% $74.6m
George Off
Independent Director23.42yrsUS$248.14k0.040% $949.1k
Clarence Davis
Independent Director11.08yrsUS$215.61k0.013% $320.5k
Prudence Carlson
Non-Independent Director12.08yrsUS$190.61k2.72% $65.4m
Kimberly Dixon
Independent Director3.08yrsUS$211.61k0.0094% $226.2k

13.4yrs

Average Tenure

65.5yo

Average Age

Experienced Board: TDS's board of directors are seasoned and experienced ( 13.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Telephone and Data Systems, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Telephone and Data Systems, Inc.
  • Ticker: TDS
  • Exchange: NYSE
  • Founded: 1968
  • Industry: Wireless Telecommunication Services
  • Sector: Telecom
  • Market Cap: US$2.399b
  • Shares outstanding: 114.52m
  • Website: https://www.tdsinc.com

Number of Employees


Location

  • Telephone and Data Systems, Inc.
  • 30 North LaSalle Street
  • Suite 4000
  • Chicago
  • Illinois
  • 60602
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TDSNYSE (New York Stock Exchange)YesCommon SharesUSUSDJan 1980

Biography

Telephone and Data Systems, Inc., a telecommunications company, provides communications services in the United States. It operates through three segments: U.S. Cellular, Wireline, and Cable. The company offers cellular services to postpaid and prepaid customers, including retail consumers, government entities, and business customers located in its service territories; national plans with voice, messaging, and data usage options; and advanced wireless solutions, such as machine-to-machine solution and software applications for various categories of monitor and control, business automation/operations, communication, and asset management. It also provides wireless devices comprising handsets, tablets, mobile hotspots, home phones, and routers; and accessories that include wireless essentials, which comprise cases, screen protectors, chargers, and memory cards, as well as various consumer electronics, such as headphones, smart speakers, wearables, and home automation products. In addition, the company offers wireline services to residential customers comprising broadband and digital television video services, as well as voice services, such as local and long-distance telephone, voice over Internet protocol (VoIP), find me follow me, collaboration, instant messaging, and other services; broadband, IP-based, and hosted voice and collaboration services to small- and medium-sized businesses; and wireline services to traditional interexchange and wireless carriers. Further, it provides business services, including data networking, Ethernet, broadband access, and VoIP services to small- and medium-sized businesses, as well as operates 262 retail stores and kiosks. The company offers its services to approximately 6 million connections. It sells its products through retail sales, direct sales, third-party retailers, and independent agents, as well as through website and telesales. The company was incorporated in 1968 and is headquartered in Chicago, Illinois. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/05 02:58
End of Day Share Price2020/06/04 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.