Verizon Communications shares moved -26.7% over the last 52 weeks, with a high of $55.51 and a low of $34.55. During this time, the stock lagged the S&P 500 index by -20.0%. As of April 2023, the company's 50-day average price is $38.96. Verizon Communications Inc., through its subsidiaries, provides communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide. The large-cap Telecommunications company has 117,100 full time employees and is based in New York, NY. Verizon Communications has returned a 6.6% dividend yield over the last 12 months.
Overview of the Company's Finances:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue | $131,868,000 | $128,292,000 | $133,613,000 | $136,835,000 |
| Gross Margins | 58.5% | 60.1% | 57.9% | 56.8% |
| Operating Margins | 23.1% | 22.4% | 24.3% | 22.3% |
| Net Income | $19,265,000 | $17,801,000 | $22,065,000 | $21,256,000 |
| Net Margins | 14.61% | 13.88% | 16.51% | 15.53% |
| Earnings Per Share | $4.65 | $4.3 | $5.32 | $5.06 |
| Diluted Shares | 4,140,000 | 4,142,000 | 4,150,000 | 4,200,000 |
| Free Cash Flow | $16,909,000 | $21,450,000 | -$28,343,000 | $10,401,000 |
| Capital Expenditures | -$18,837,000 | -$20,318,000 | -$67,882,000 | -$26,740,000 |
| Net Current Assets | -$191,419,000 | -$192,615,000 | -$246,668,000 | -$249,360,000 |
| Current Ratio | 0.84 | 1.38 | 0.78 | 0.75 |
| Long Term Debt | $99,932,000 | $123,173,000 | $143,425,000 | $140,676,000 |
| Net Debt / EBITDA | 2.25 | 2.37 | 2.81 | 2.96 |
The Market May Be Undervaluing Verizon Communications's Assets and Equity:
Compared to the Telecommunications sector's average of 18.85, Verizon Communications has a trailing twelve month P/E ratio of 7.7 and, according to its EPS guidance of $4.72, an expected P/E ratio of 8.3. Verizon Communications's PEG ratio is 25.73 based on its 0.3% compound average growth rate of historical and projected earnings per share. This suggests that the company's shares are overvalued. However, Verizon Communications is possibly undervalued in terms of its book value because its P/B ratio is 1.8 compared to its sector average of 3.12. As of the date of publication, the company's shares are trading -18.8% below their Graham number of $48.56.
There's an Analyst Consensus of Some Upside Potential for Verizon Communications:
24 analysts are following Verizon Communications and have set target prices ranging from $33.0 to $64.0 per share. On average, they have given the company a rating of hold. At the current price of $38.96, VZ is trading -12.3% away from its average analyst target price of $44.43 per share, implying an analyst consensus of some upside potential for the stock. The company has a very low short interest since 1.0% of the company's shares are tied to short positions. Institutions own 64.2% of Verizon Communications's shares, while the insider ownership rate stands at 0.03%. which is a small amount of insider investors. The company's biggest shareholder is the Vanguard Group, Inc. with a 8% stake in the company worth $13,990,765,442.
