Telefonica Brasil SA

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VIV : NYSE : Technology
$14.45 up 0.19 | 1.30%
Today's Range: 14.39 - 14.58
Avg. Daily Volume: 1,826,800
07/27/16 - 10:44 AM ET

Financial Analysis


TELEFONICA BRASIL SA's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. TELEFONICA BRASIL SA has weak liquidity. Currently, the Quick Ratio is 0.73 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 43.93% 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 Q1 FY16 Q1 FY15
Net Sales ($mil)2938.422821.05
EBITDA ($mil)954.19851.96
EBIT ($mil)415.25410.69
Net Income ($mil)343.16182.06


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)1214.411071.63
Total Assets ($mil)28519.822855.27
Total Debt ($mil)2405.112193.12
Equity ($mil)19519.6413561.41


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin62.9961.65
EBITDA Margin32.4730.2
Operating Margin14.1314.56
Sales Turnover0.360.53
Return on Assets3.597.64
Return on Equity5.2512.88
Debt Q1 FY16 Q1 FY15
Current Ratio1.050.89
Debt/Capital0.110.14
Interest Expense129.491.39
Interest Coverage3.214.49


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)1119.34741.93
Div / share0.080.86
EPS0.310.24
Book value / share17.4418.28
Institutional Own % n/a n/a
Avg Daily Volume1864516.02121926.0

Valuation


HOLD. This stock's P/E ratio indicates a discount compared to an average of 17.52 for the Diversified Telecommunication Services industry and a discount compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 0.82 indicates a significant discount versus the S&P 500 average of 2.81 and a significant discount versus the industry average of 4.50. The price-to-sales ratio is 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 15.05 Peers 17.52   VIV 6.15 Peers 7.54

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

VIV 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.

VIV is trading at a 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 18.10 Peers 17.74   VIV NM Peers 1.20

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

VIV is trading at a premium to 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 0.82 Peers 4.50   VIV -59.75 Peers 61.06

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.

 

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

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

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
VIV 1.56 Peers 1.84   VIV -15.49 Peers 7.37

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 discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

VIV significantly trails its peers on the basis of sales growth

 

 

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