Communication Services Sector Report
Market Cap: $3.7T
Stocks: 173
Median P/E: 12.5x
Median ROIC: 5.3%
Data sourced from SEC EDGAR filings. Report refreshed weekly.
The Communication Services sector encompasses telecommunications providers, media companies, entertainment firms, and interactive media platforms. The sector has evolved from traditional telecom into a hybrid of infrastructure and content businesses. Key investment themes include 5G deployment, digital advertising growth, content monetization, and the shift from linear to streaming distribution.
Performance Dashboard
| Period | Sector (MCW) | Sector (Median) |
|---|---|---|
| 1 Day | -1.6% | +0.1% |
| 1 Week | -1.5% | +0.8% |
| 1 Month | — | — |
| 3 Months | — | — |
| 6 Months | — | — |
| YTD | -1.6% | +0.6% |
| 1 Year | +30.4% | +1.1% |
| 3 Years | +80.2% | +8.5% |
| 5 Years | +27.8% | -19.4% |
Today's Breadth: 71 advancing · 54 declining · 11 flat
Valuation Summary
| Metric | Median | P25 | P75 | vs 5Y Avg |
|---|---|---|---|---|
| P/E | 12.5x | 4.0x | 27.4x | -10% |
| P/B | 1.1x | 0.4x | 2.7x | -29% |
| P/S | 0.8x | 0.2x | 1.9x | — |
| P/FCF | 8.7x | 3.7x | 14.6x | — |
| EV/EBITDA | 8.5x | 6.0x | 15.6x | — |
| EV/EBIT | 13.8x | 10.2x | 21.0x | — |
Earnings Yield
5.8%
FCF Yield
7.3%
Below Fair Value
42% of stocks
Profitability Profile
Margins
| Metric | Median | 5Y Avg | P25 | P75 |
|---|---|---|---|---|
| Gross Margin | 50.8% | 49.6% | 37.9% | 67.0% |
| Operating Margin | 4.8% | — | -6.5% | 14.1% |
| Net Margin | 3.2% | 2.6% | -7.3% | 12.2% |
| FCF Margin | 8.4% | — | 0.5% | 17.2% |
Returns on Capital
| Metric | Median | 5Y Avg | P25 | P75 |
|---|---|---|---|---|
| ROE | 4.6% | — | -8.7% | 12.2% |
| ROA | 0.8% | — | -6.0% | 5.2% |
| ROIC | 5.3% | 4.6% | -5.8% | 10.8% |
Growth Metrics
| Metric | 1Y | 3Y CAGR | 5Y CAGR |
|---|---|---|---|
| Revenue | +1.7% | +0.6% | +1.4% |
| EPS | +39.4% | +12.3% | +5.0% |
| Free Cash Flow | +11.6% | -2.2% | +0.1% |
All values represent sector median growth rates.
Balance Sheet Health
Debt / Equity
0.6x
Net Debt / EBITDA
2.4x
Interest Coverage
0.8x
Current Ratio
1.1x
Altman Z-Score
Safe (>3): 23 (14%)
Gray (1.8–3): 21 (13%)
Distress (<1.8): 115 (72%)
Piotroski F-Score
Strong (7–9): 36 (21%)
Moderate (4–6): 98 (57%)
Weak (0–3): 39 (23%)
Top Companies
| Symbol | #▲ | Mkt Cap | P/E | EV/EBITDA | ROIC | Net Mgn | Rev Gr. | Div Yld | YTD | Qual. |
|---|---|---|---|---|---|---|---|---|---|---|
| TV | 1 | $697.1B | — | — | -7.5% | -13.4% | -6.0% | 0.3% | -11.7% | 2/9 |
| NFLX | 2 | $447.8B | 37.3x | 30.4x | 36.7% | 24.3% | +15.8% | — | +4.1% | 7/9 |
| CCZ | 3 | $241.2B | 11.1x | 8.3x | 8.8% | 16.2% | -0.0% | 2.2% | -2.7% | 5/9 |
| TMUS | 4 | $217.6B | 20.6x | 9.5x | 10.6% | 12.4% | +8.5% | 1.9% | -0.5% | 7/9 |
| VZ | 5 | $192.1B | 9.8x | 6.5x | 9.0% | 12.4% | +2.5% | 6.9% | -0.2% | 4/9 |
| T | 6 | $184.4B | 8.0x | 6.3x | 8.5% | 17.4% | +2.7% | 4.6% | +1.7% | 3/9 |
| TBB | 7 | $157.3B | 7.3x | 5.9x | — | 17.4% | +2.7% | 5.2% | +0.2% | 3/9 |
| VEON | 8 | $111.7B | 169.4x | — | 71.3% | 12.2% | +8.3% | 0.1% | — | 2/9 |
| CMCSA | 9 | $111.0B | 5.1x | 5.1x | 8.8% | 16.2% | -0.0% | 4.5% | -0.3% | 5/9 |
| SPOT | 10 | $103.8B | 55.6x | 45.9x | 37.9% | 12.8% | +14.9% | — | +3.1% | 4/9 |
| AMX | 11 | $80.0B | — | — | 22.1% | 3.2% | +1.6% | — | +3.3% | 4/9 |
| AMXOF | 12 | $71.7B | — | — | 22.1% | 3.2% | +1.6% | — | 0.0% | 4/9 |
| WBD | 13 | $68.7B | 99.3x | 14.9x | 0.7% | 1.9% | -5.2% | — | +0.1% | 0/9 |
| OBEL-BR | 14 | $59.3B | 17.0x | 17.9x | 4.6% | 5.8% | +1.0% | 5.8% | — | 1/9 |
| FNCTF | 15 | $53.8B | — | — | 4.7% | 6.5% | +4.7% | — | -0.7% | 1/9 |
| REN-AS | 16 | $52.0B | 31.6x | 23.5x | 25.5% | 21.5% | +4.9% | 1.8% | — | 4/9 |
| REL-L | 17 | $46.0B | 27.6x | 20.8x | 25.8% | 21.5% | +4.9% | 2.1% | — | 7/9 |
| SATS | 18 | $36.1B | — | — | -41.3% | -96.6% | -5.2% | — | +3.6% | 0/9 |
| CHT | 19 | $32.7B | — | — | — | 16.7% | -0.3% | — | +1.7% | 0/9 |
| CHTR | 20 | $31.2B | 5.7x | 5.7x | 9.0% | 9.1% | -0.6% | — | +3.5% | 5/9 |
Industry Composition
| Industry | Stocks | Market Cap | % | |
|---|---|---|---|---|
| Telephone Communications (No Radiotelephone) | 27 | $826.2B | 22.6% | |
| Television Broadcasting Stations | 13 | $815.4B | 22.3% | |
| Cable & Other Pay Television Services | 19 | $503.7B | 13.8% | |
| Radiotelephone Communications | 12 | $451.6B | 12.4% | |
| Services-Video Tape Rental | 2 | $447.8B | 12.3% | |
| Radio Broadcasting Stations | 14 | $120.7B | 3.3% | |
| Telecommunications Services | 6 | $117.2B | 3.2% | |
| Publishing | 8 | $116.0B | 3.2% | |
| Communications Services, Nec | 17 | $87.8B | 2.4% | |
| Advertising Agencies | 11 | $69.4B | 1.9% | |
| Newspapers: Publishing Or Publishing & Printing | 6 | $45.7B | 1.3% | |
| Books: Publishing Or Publishing & Printing | 4 | $13.7B | 0.4% | |
| Entertainment | 4 | $12.6B | 0.3% | |
| Services-Motion Picture & Video Tape Production | 7 | $7.5B | 0.2% | |
| Broadcasting | 5 | $5.6B | 0.2% |
Showing top 15 of 24 industries.
Quality Distribution
0
1
2
3
4
5
6
7
8
9
Quality Score (0-9)
High Quality (7+)
3%
Median Piotroski F
5/9
Profitable Years
5 of 10
Dividends & Shareholder Returns
Paying Dividends
43%
Median Div Yield
3.2%
Median Buyback Yield
0.5%
Shareholder Yield
2.3%
Payout Ratio
46.5%
Div Growth (3Y)
2.9%
Div Growth (5Y)
2.6%
Strengths & Weaknesses
Strengths
- +[Profitability]High pricing power with a median gross margin of 50.8%, reflecting differentiated products or strong brand moats.
Weaknesses
- −[Financial Health]72.3% of companies fall in the Altman Z-Score distress zone (<1.8), indicating elevated bankruptcy risk within the sector.
- −[Growth]Sluggish top-line growth with a median 5-year revenue CAGR of 1.4%, barely keeping pace with inflation.
- −[Leverage]Tight interest coverage at 0.8x, leaving limited cushion for debt servicing if earnings decline.
- −[Profitability]Below-average capital returns with a median ROIC of 5.3%, suggesting limited pricing power or capital-intensive operations.