Verizon Communications Inc

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VZ : NYSE : Technology
$50.31 up 0.64 | 1.29%
Today's Range: 49.67 - 50.5
Avg. Daily Volume: 1.57336E7
02/23/17 - 4:04 PM ET

Financial Analysis


VERIZON COMMUNICATIONS INC's gross profit margin for the fourth quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Sales and net income have dropped, although the growth in revenues underperformed the average competitor within the industry, the net income growth did not. VERIZON COMMUNICATIONS INC has weak liquidity. Currently, the Quick Ratio is 0.67 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 37.10% 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 ($mil)32340.034254.0
EBITDA ($mil)12010.013783.0
EBIT ($mil)8023.09744.0
Net Income ($mil)4495.05391.0


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)2880.05070.0
Total Assets ($mil)244180.0244640.0
Total Debt ($mil)108078.0110194.0
Equity ($mil)22524.016428.0


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin55.5957.06
EBITDA Margin37.1340.23
Operating Margin24.8128.45
Sales Turnover0.520.54
Return on Assets5.377.3
Return on Equity58.28108.83
Debt Q4 FY16 Q4 FY15
Current Ratio0.870.64
Debt/Capital0.830.87
Interest Expense0.01357.0
Interest Coverage0.07.18


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)4077.04073.18
Div / share0.580.57
EPS1.11.32
Book value / share5.524.03
Institutional Own % n/a n/a
Avg Daily Volume1.5471281E71.3806528E7

Valuation


BUY. VERIZON COMMUNICATIONS INC's P/E ratio indicates a significant discount compared to an average of 27.22 for the Diversified Telecommunication Services industry and a significant discount compared to the S&P 500 average of 26.35. For additional comparison, its price-to-book ratio of 8.77 indicates a significant premium versus the S&P 500 average of 2.94 and a significant premium versus the industry average of 3.72. 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.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
VZ 15.05 Peers 27.22   VZ 8.70 Peers 8.68

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

VZ is trading at a significant discount to its peers.

 

Average. 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 valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
VZ 12.12 Peers 26.00   VZ 0.73 Peers 0.69

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.

 

Average. 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 valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
VZ 8.77 Peers 3.72   VZ -26.32 Peers -6.66

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.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
VZ 1.57 Peers 2.06   VZ -4.29 Peers 7.07

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.

VZ 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.

VZ significantly trails its peers on the basis of sales growth

 

 

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