Telecom stocks like AT&T (NYSE:T) and Verizon (NYSE:VZ) are popular because of stable business models and rich revenue streams that add up to big dividends. But don’t fool yourself into thinking a tip-top dividend yield makes all telecom stocks a good investment. Many telecoms that provide service overseas have been caught up in the euro zone debacle and other local issues that have sent their shares sharply downward, offsetting any income potential.
I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve pinpointed seven foreign telecom stocks to hang up on.
Here they are, in alphabetical order. Each one of these stocks gets a “D” or “F” according to my research, meaning it is a “sell” or “strong sell.”
France Telecom (NYSE:FTE) is an international company that focuses on fixed and mobile communications, data transmission and the Internet and multimedia — among other services. Despite its global reach, FTE stock has foundered this year, down nearly 24% year-to-date.
KT Corp. (NYSE:KT) is an integrated telecom that operates in South Korea. Like many other international telecom stocks, KT is down this year, in this case by 26%.
Portugal Telecom SGPS (NYSE:PT) stock has dipped 46%, year-to-date, compared to the Dow Jones, which is down less than 1%.
Tele Norte Leste Particiapcoes (NYSE:TNE) is based in Brazil and offers a wide range of services, including fixed-line and mobile telecom, data transmission, pay TV, Internet and call-center services. A drop of 37% year-to-date has left many TNE shareholders wondering why they made their initial investment.
Telefonica (NYSE:TEF) is based in Spain and operates in the telecom, media and contact-center industries. TEF has followed the lead of many other telecom stocks and is down 20% since the start of 2011.
Telecom Argentina (NYSE: TEO) provides numerous services, including: national fixed-line telecommunications, international long-distance, data transmission, Internet and mobile phone service. A stark dip of 27% for TEO has far outpaced the minimal losses by the broader markets.
Telekomunikasi Indonesia (NYSE:TLK) offers many services, not limited to fixed wire-line and fixed wireless phone, mobile cellular, data and Internet and network and interconnection. TLK may have looked like a smart buy for some, but it has dipped almost 9% year-to-date.
Get more analysis of these picks and other publicly traded stocks with Louis Navellier’s Portfolio Grader tool, a 100% free stock-rating tool that measures both quantitative buying pressure and eight fundamental factors.
