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Verizon Communications Inc
VZ : NYSE : Technology
$43.56 up0.06 | 0.15%
Today's Range: 43.50 - 43.99
Avg. Daily Volume: 15,741,100
10/07/15 - 12:43 PM ET

Financial Analysis

VERIZON COMMUNICATIONS INC's gross profit margin for the second quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. VERIZON COMMUNICATIONS INC has weak liquidity. Currently, the Quick Ratio is 0.55 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 23.39% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY15 Q2 FY14
Net Sales ($mil)32224.031483.0
EBITDA ($mil)11801.011139.0
EBIT ($mil)7821.06978.0
Net Income ($mil)4231.04214.0

Balance Sheet Q2 FY15 Q2 FY14
Cash & Equiv. ($mil)3317.06424.0
Total Assets ($mil)240753.0224427.0
Total Debt ($mil)113671.0109979.0
Equity ($mil)11415.014901.0

Profitability Q2 FY15 Q2 FY14
Gross Profit Margin61.3761.61
EBITDA Margin36.6235.38
Operating Margin24.2722.16
Sales Turnover0.540.55
Return on Assets4.116.88
Return on Equity86.85103.75
Debt Q2 FY15 Q2 FY14
Current Ratio0.70.86
Interest Expense1378.01276.0
Interest Coverage5.685.47

Share Data Q2 FY15 Q2 FY14
Shares outstanding (mil)4065.694145.23
Div / share0.550.53
Book value / share2.813.59
Institutional Own % n/a n/a
Avg Daily Volume1.5620072E71.5056962E7


BUY. VERIZON COMMUNICATIONS INC's P/E ratio indicates a discount compared to an average of 23.51 for the Diversified Telecommunication Services industry and a value on par with the S&P 500 average of 19.38. For additional comparison, its price-to-book ratio of 15.30 indicates a significant premium versus the S&P 500 average of 2.58 and a significant premium versus the industry average of 6.93. The price-to-sales ratio is below both the S&P 500 average and the industry average, indicating a discount. The valuation analysis reveals that, VERIZON COMMUNICATIONS INC seems to be trading at a discount to investment alternatives within the industry.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
VZ 17.83 Peers 23.51   VZ 5.08 Peers 13.02

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

VZ is trading at a discount to its peers.


Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

VZ is trading at a significant discount to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
VZ 10.69 Peers 15.79   VZ 0.28 Peers 0.77

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

VZ is trading at a significant discount to its peers.


Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

VZ trades at a significant discount to its peers.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
VZ 15.30 Peers 6.93   VZ -48.73 Peers -20.61

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

VZ is trading at a significant premium to its peers.


Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, VZ is expected to significantly trail its peers on the basis of its earnings growth rate.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
VZ 1.35 Peers 1.44   VZ 4.31 Peers -3.90

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

VZ is trading at a valuation on par with its industry on this measurement.


Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

VZ has a sales growth rate that significantly exceeds its peers.



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