Telefonica Brasil SA

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VIV : NYSE : Technology
$14.89 -0.02 | -0.13%
Today's Range: 14.78 - 14.96
Avg. Daily Volume: 1525200.0
03/30/17 - 4:03 PM ET

Financial Analysis


TELEFONICA BRASIL SA's gross profit margin for the fourth quarter of its fiscal year 2016 has increased 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. TELEFONICA BRASIL SA has weak liquidity. Currently, the Quick Ratio is 0.69 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 22.90% 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 Q4 FY16 Q4 FY15
Net Sales ($mil)3313.072710.51
EBITDA ($mil)1169.03869.58
EBIT ($mil)616.46398.5
Net Income ($mil)370.76273.34


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)1662.221407.37
Total Assets ($mil)31374.1125682.59
Total Debt ($mil)2707.92486.19
Equity ($mil)21285.0217318.02


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin67.9263.67
EBITDA Margin35.2832.08
Operating Margin18.6114.7
Sales Turnover0.420.4
Return on Assets4.03.36
Return on Equity5.894.98
Debt Q4 FY16 Q4 FY15
Current Ratio0.91.0
Debt/Capital0.110.13
Interest Expense133.09122.2
Interest Coverage4.633.26


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)1119.341119.34
Div / share0.120.09
EPS0.330.24
Book value / share19.0215.47
Institutional Own % n/a n/a
Avg Daily Volume1519778.01959283.0

Valuation


BUY. TELEFONICA BRASIL SA's P/E ratio indicates a significant discount compared to an average of 28.77 for the Diversified Telecommunication Services industry and a significant discount compared to the S&P 500 average of 26.33. For additional comparison, its price-to-book ratio of 0.77 indicates a significant discount versus the S&P 500 average of 2.93 and a significant discount versus the industry average of 3.76. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, TELEFONICA BRASIL SA proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
VIV 13.15 Peers 28.77   VIV 4.69 Peers 7.08

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

VIV is trading at a significant 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.

VIV is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
VIV 14.16 Peers 15.93   VIV NM Peers 0.63

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

VIV is trading at a valuation on par with its peers.

 

Neutral. 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.

VIV's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
VIV 0.77 Peers 3.76   VIV 27.27 Peers 6.47

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

VIV is trading at a significant discount to its peers.

 

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

VIV is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
VIV 1.26 Peers 1.92   VIV 28.41 Peers 4.56

Discount. 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.

VIV is trading at a significant discount to its industry on this measurement.

 

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

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

 

 

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