Telefonica Brasil SA

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VIV : NYSE : Technology
$16.37 | %
Today's Range: 16.28 - 16.59
Avg. Daily Volume: 1244100.0
09/22/17 - 4:02 PM ET

Financial Analysis


TELEFONICA BRASIL SA's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have dropped, underperforming the average competitor within its industry. TELEFONICA BRASIL SA has weak liquidity. Currently, the Quick Ratio is 0.74 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 remained virtually unchanged only decreasing by 2.71% 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 FY17 Q2 FY16
Net Sales ($mil)3091.243605.17
EBITDA ($mil)1079.061185.37
EBIT ($mil)513.55516.11
Net Income ($mil)250.45256.07


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)2348.851855.96
Total Assets ($mil)31568.6531730.64
Total Debt ($mil)3152.742572.69
Equity ($mil)20769.3921347.93


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin67.064.49
EBITDA Margin34.932.87
Operating Margin16.6114.32
Sales Turnover0.410.33
Return on Assets3.873.14
Return on Equity5.884.67
Debt Q2 FY17 Q2 FY16
Current Ratio0.960.98
Debt/Capital0.130.11
Interest Expense91.9124.41
Interest Coverage5.594.15


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)1119.341119.34
Div / share0.440.34
EPS0.220.22
Book value / share18.5619.07
Institutional Own % n/a n/a
Avg Daily Volume1231685.01481401.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 34.54 for the Diversified Telecommunication Services industry and a discount compared to the S&P 500 average of 24.93. For additional comparison, its price-to-book ratio of 0.89 indicates a significant discount versus the S&P 500 average of 3.11 and a significant discount versus the industry average of 3.56. 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 15.16 Peers 34.54   VIV 5.29 Peers 7.11

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 15.79 Peers 15.74   VIV NM Peers 0.68

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 0.89 Peers 3.56   VIV 23.86 Peers 55.16

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 1.43 Peers 11.06   VIV 21.96 Peers 0.84

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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