VZ Stock Overview
Verizon Communications Inc., through its subsidiaries, offers communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide.
Verizon Communications Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$39.52|
|52 Week High||US$55.51|
|52 Week Low||US$39.11|
|1 Month Change||-9.25%|
|3 Month Change||-22.45%|
|1 Year Change||-27.31%|
|3 Year Change||-34.46%|
|5 Year Change||-20.15%|
|Change since IPO||38.67%|
Recent News & Updates
Verizon Communications (NYSE:VZ) Has Announced That It Will Be Increasing Its Dividend To $0.6525
The board of Verizon Communications Inc. ( NYSE:VZ ) has announced that it will be paying its dividend of $0.6525 on...
Verizon: Finally At Attractive Prices
Summary Earnings continue to set new highs, which is not reflected in the company's share price. The 6.33% yield is very safe and should continue to grow by high single-digits. The company appears to be attractively valued based on its earnings, stock chart and capital allocation capabilities. Introduction For investors looking for a high but reliable dividend, with the prospect of single-digit growth going forward, this stock may be for them. Despite continuing to post decent growth, the share price of Verizon (VZ) has collapsed in recent months to a new 6-year low of $40.55. Verizon is a major American telecommunications company, currently being the second largest in the country just behind AT&T (T). The company currently has 240,000+ employees with operations spanning across thousands of cities. It's an already large company in a competitive industry, notorious for its large investment needs, but also known for its high dividend payments. While it may not be what every investor is looking for, it should catch the interest of dividend yield-seeking investors. Fundamentals Unfortunately, Verizon's revenues has been stagnant for the past 6 years, which is a bit worrying to see. It is not uncommon for such companies in the telecommunications industry to have slow growth, but it is definitely something to be aware of. The stagnant revenue puts extra pressure on the importance of margins being expandable, as in this case it is the only source of growth. However, management guided towards low single-digit growth going forward, when they held their investor presentation earlier this year. Revenue (Macrotrends.com) As seen in the image below, the net profit margin has expanded continuously since it bought Vodafone's 45% stake for $130 billion back in 2014. These annual margin expansions have been the main source of net income growth, but we have to wonder for how long this can be sustained. Net profit margin (Macrotrends.com) It has nevertheless produced an impressive amount of net income. The cash has mainly been paid out as dividends, while the rest is reinvested back into the company. The net income easily covers the dividend with a manageable payout ratio of ~50%. Given its current valuation, this results in a yield of 6.33%. Capital allocation Since the acquisition of the remaining interest of Verizon Wireless in 2014, the management of the company has been fairly good at capital allocation. The company has had a return on equity of 20%+, which is great, when you consider that equity is still growing. Although still above 20% today, it has been declining in recent years, showing signs that the rate is unsustainable. Although their return on equity has been slightly decreasing, it has still been above 20%. Since the company has paid out ~50% of earnings and no meaningful share buybacks have been made, the remaining 50% has been reinvested. This money has been invested at a return of ~22%, increasing the company's book value per share by ~11% per year. Should the company adopt a strategy of share buybacks instead of reinvesting earnings due to lower reinvestment returns, then that would also be sufficient, as the buybacks would yield ~6.3%. The expected annual returns will therefore still be in the double digits. Equity & ROE (Macrotrends.com) Valuation Given the consistent growth you might expect the stock to be valued close to a standard multiple of 15. This would most likely have been true, if it weren't for the debt that the company has. The market started assigning a lower multiple after 2014, following the 45% Verizon Wireless purchase. Before the acquisition, when the company was not so leveraged, the average multiple was ~15.4. The average multiple in the last 2 decades has been 14.66. Verizon as of their most recent quarter carries $175b in debt with only $1.8b in cash, cash equivalents and short term investments. The net debt of $173.8b is a big liability for equity investors and affects the value of the company. To avoid paying too much for the business, I suggest you add the net debt to the market value. The new $344b company now has an adjusted operating earnings multiple of ~15.5, which still seems attractive. Earnings per share with multiples (fastgraphs.com) Stock chart Quick disclaimer: A technical analysis by itself is not a good enough reason to buy a stock, but combined with the fundamentals of the company, it can greatly narrow your price target range when buying. Although Verizon's stock chart is a bit messy due to a decline in earnings per share from 2002-2012, it still shows decent areas of support. I would have assumed that prices below the 50-month moving average would be decent accumulation areas, with the ideal buying area being near the 200-month moving average.
Debt & the Telecom Giants: Why Spreading the Risk May be Important in an Economic Decline
AT&T Inc. (NYSE:T), T-Mobile US (NYSE:TMUS), and Verizon (NYSE:VZ) are the three key telecom operators in the US. The stocks had lackluster performance, with TMUS delivering 6.8% in the last 12 months, T experiencing a deep drop of 38.4% and VZ losing some 23.3%. In this article we will discuss the effects of debt, 5G and consumer spending on the valuations of these stocks as well as see how their fundamentals compare.
|VZ||US Telecom||US Market|
Return vs Industry: VZ exceeded the US Telecom industry which returned -33.1% over the past year.
Return vs Market: VZ underperformed the US Market which returned -21.6% over the past year.
|VZ Average Weekly Movement||3.2%|
|Telecom Industry Average Movement||6.2%|
|Market Average Movement||6.9%|
|10% most volatile stocks in US Market||15.9%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: VZ is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: VZ's weekly volatility (3%) has been stable over the past year.
About the Company
Verizon Communications Inc., through its subsidiaries, offers communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide. Its Consumer segment provides postpaid and prepaid service plans; internet access on notebook computers and tablets; wireless equipment, including smartphones and other handsets; and wireless-enabled internet devices, such as tablets, and other wireless-enabled connected devices comprising smart watches. It also provides residential fixed connectivity solutions, such as internet, video, and voice services; and sells network access to mobile virtual network operators.
Verizon Communications Fundamentals Summary
|VZ fundamental statistics|
Is VZ overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|VZ income statement (TTM)|
|Cost of Revenue||US$57.29b|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
Oct 21, 2022
|Earnings per share (EPS)||4.95|
|Net Profit Margin||15.48%|
How did VZ perform over the long term?See historical performance and comparison
6.6%Current Dividend Yield
Does VZ pay a reliable dividends?See VZ dividend history and benchmarks
|Verizon Communications dividend dates|
|Ex Dividend Date||Oct 06 2022|
|Dividend Pay Date||Nov 01 2022|
|Days until Ex dividend||11 days|
|Days until Dividend pay date||37 days|
Does VZ pay a reliable dividends?See VZ dividend history and benchmarks
Is VZ undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 6/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for VZ?
Other financial metrics that can be useful for relative valuation.
|What is VZ's n/a Ratio?|
Price to Earnings Ratio vs Peers
How does VZ's PE Ratio compare to its peers?
|VZ PE Ratio vs Peers|
|Company||PE||Estimated Growth||Market Cap|
FYBR Frontier Communications Parent
TMUS T-Mobile US
VZ Verizon Communications
Price-To-Earnings vs Peers: VZ is good value based on its Price-To-Earnings Ratio (8x) compared to the peer average (32x).
Price to Earnings Ratio vs Industry
How does VZ's PE Ratio compare vs other companies in the Global Telecom Industry?
Price-To-Earnings vs Industry: VZ is good value based on its Price-To-Earnings Ratio (8x) compared to the Global Telecom industry average (16.2x)
Price to Earnings Ratio vs Fair Ratio
What is VZ's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PE Ratio||8x|
|Fair PE Ratio||11.4x|
Price-To-Earnings vs Fair Ratio: VZ is good value based on its Price-To-Earnings Ratio (8x) compared to the estimated Fair Price-To-Earnings Ratio (11.4x).
Share Price vs Fair Value
What is the Fair Price of VZ when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: VZ ($39.52) is trading below our estimate of fair value ($185.97)
Significantly Below Fair Value: VZ is trading below fair value by more than 20%.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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How is Verizon Communications forecast to perform in the next 1 to 3 years based on estimates from 25 analysts?
Future Growth Score1/6
Future Growth Score 1/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: VZ's forecast earnings growth (4.8% per year) is above the savings rate (1.9%).
Earnings vs Market: VZ's earnings (4.8% per year) are forecast to grow slower than the US market (14.7% per year).
High Growth Earnings: VZ's earnings are forecast to grow, but not significantly.
Revenue vs Market: VZ's revenue (1.7% per year) is forecast to grow slower than the US market (7.6% per year).
High Growth Revenue: VZ's revenue (1.7% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: VZ's Return on Equity is forecast to be low in 3 years time (19.8%).
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How has Verizon Communications performed over the past 5 years?
Past Performance Score4/6
Past Performance Score 4/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: VZ has high quality earnings.
Growing Profit Margin: VZ's current net profit margins (15.5%) are higher than last year (15%).
Past Earnings Growth Analysis
Earnings Trend: VZ's earnings have declined by 3.4% per year over the past 5 years.
Accelerating Growth: VZ's earnings growth over the past year (4%) exceeds its 5-year average (-3.4% per year).
Earnings vs Industry: VZ earnings growth over the past year (4%) exceeded the Telecom industry -34.4%.
Return on Equity
High ROE: Whilst VZ's Return on Equity (24.4%) is high, this metric is skewed due to their high level of debt.
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How is Verizon Communications's financial position?
Financial Health Score3/6
Financial Health Score 3/6
Short Term Liabilities
Long Term Liabilities
Financial Position Analysis
Short Term Liabilities: VZ's short term assets ($37.5B) do not cover its short term liabilities ($49.2B).
Long Term Liabilities: VZ's short term assets ($37.5B) do not cover its long term liabilities ($233.6B).
Debt to Equity History and Analysis
Debt Level: VZ's net debt to equity ratio (170.9%) is considered high.
Reducing Debt: VZ's debt to equity ratio has reduced from 439.6% to 173.1% over the past 5 years.
Debt Coverage: VZ's debt is well covered by operating cash flow (24.3%).
Interest Coverage: VZ's interest payments on its debt are well covered by EBIT (8.7x coverage).
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What is Verizon Communications's current dividend yield, its reliability and sustainability?
Dividend Score 5/6
Cash Flow Coverage
Current Dividend Yield
Upcoming Dividend Payment
Dividend Yield vs Market
Notable Dividend: VZ's dividend (6.6%) is higher than the bottom 25% of dividend payers in the US market (1.62%).
High Dividend: VZ's dividend (6.6%) is in the top 25% of dividend payers in the US market (4.45%)
Stability and Growth of Payments
Stable Dividend: VZ's dividends per share have been stable in the past 10 years.
Growing Dividend: VZ's dividend payments have increased over the past 10 years.
Earnings Payout to Shareholders
Earnings Coverage: With its reasonable payout ratio (51.4%), VZ's dividend payments are covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: With its high cash payout ratio (108.4%), VZ's dividend payments are not well covered by cash flows.
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Hans Vestberg (57 yo)
Mr. Hans E. Vestberg has been Chief Executive Officer at Verizon Communications Inc. since August 01, 2018 and served as its Executive Chairman until January 2019. He has been the Chairman of the Board at...
CEO Compensation Analysis
Compensation vs Market: Hans's total compensation ($USD20.34M) is above average for companies of similar size in the US market ($USD13.05M).
Compensation vs Earnings: Hans's compensation has been consistent with company performance over the past year.
Experienced Management: VZ's management team is seasoned and experienced (5.3 years average tenure).
Experienced Board: VZ's board of directors are considered experienced (7 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
|26 Apr 22||SellUS$1,176,911||Tamara Erwin||Individual||23,647||US$49.77|
|26 Jan 22||BuyUS$998,450||Hans Vestberg||Individual||19,000||US$52.55|
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Verizon Communications Inc.'s employee growth, exchange listings and data sources
- Name: Verizon Communications Inc.
- Ticker: VZ
- Exchange: NYSE
- Founded: 1983
- Industry: Integrated Telecommunication Services
- Sector: Telecom
- Implied Market Cap: US$165.973b
- Shares outstanding: 4.20b
- Website: https://www.verizon.com
Number of Employees
- Verizon Communications Inc.
- 1095 Avenue of the Americas
- New York
- New York
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|VZ||NYSE (New York Stock Exchange)||Yes||Common Stock||US||USD||Nov 1983|
|VZ *||BMV (Bolsa Mexicana de Valores)||Yes||Common Stock||MX||MXN||Nov 1983|
|0Q1S||LSE (London Stock Exchange)||Yes||Common Stock||GB||USD||Nov 1983|
|VZ||SWX (SIX Swiss Exchange)||Yes||Common Stock||CH||CHF||Nov 1983|
|BAC||DB (Deutsche Boerse AG)||Yes||Common Stock||DE||EUR||Nov 1983|
|BAC||XTRA (XETRA Trading Platform)||Yes||Common Stock||DE||EUR||Nov 1983|
|VZ||SNSE (Santiago Stock Exchange)||Yes||Common Stock||CL||USD||Nov 1983|
|VZ||ETLX (Eurotlx)||Yes||Common Stock||IT||EUR||Nov 1983|
|VZ||WBAG (Wiener Boerse AG)||Yes||Common Stock||AT||EUR||Nov 1983|
|VZ||BVL (Bolsa de Valores de Lima)||Yes||Common Stock||PE||USD||Nov 1983|
|VERIZ||ENXTBR (Euronext Brussels)||Yes||Common Stock||BE||USD||Nov 1983|
|BAC||BUL (Bulgaria Stock Exchange)||Yes||Common Stock||BG||EUR||Nov 1983|
|VZ_KZ||KAS (Kazakhstan Stock Exchange)||Yes||Common Stock||KZ||USD||Nov 1983|
|VZ||BASE (Buenos Aires Stock Exchange)||CEDEAR REP 1/2 COM (USD)||AR||ARS||Feb 2011|
|VZD||BASE (Buenos Aires Stock Exchange)||CEDEAR REP 1/2 COM (USD)||AR||USD||Feb 2011|
|VERZ34||BOVESPA (Bolsa de Valores de Sao Paulo)||BDR EACH 6 REP 1 COM||BR||BRL||Aug 2012|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/09/23 00:00|
|End of Day Share Price||2022/09/23 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.