VERIZON COMMUNICATIONS INC (BAC.DE) Stock Fundamental Analysis
FRA:BAC - Deutsche Boerse Ag - US92343V1044 - Common Stock - Currency: EUR
BAC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 28 industry peers in the Diversified Telecommunication Services industry. BAC scores excellent on profitability, but there are concerns on its financial health. BAC is not valued too expensively and it also shows a decent growth rate. BAC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year BAC was profitable.
In the past year BAC had a positive cash flow from operations.
BAC had positive earnings in each of the past 5 years.
In the past 5 years BAC always reported a positive cash flow from operatings.
1.2 Ratios
BAC's Return On Assets of 4.68% is fine compared to the rest of the industry. BAC outperforms 75.00% of its industry peers.
With a decent Return On Equity value of 17.66%, BAC is doing good in the industry, outperforming 75.00% of the companies in the same industry.
With a decent Return On Invested Capital value of 7.49%, BAC is doing good in the industry, outperforming 67.86% of the companies in the same industry.
BAC had an Average Return On Invested Capital over the past 3 years of 7.15%. This is in line with the industry average of 8.31%.
The last Return On Invested Capital (7.49%) for BAC is above the 3 year average (7.15%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.68% | ||
| ROE | 17.66% | ||
| ROIC | 7.49% |
ROA(3y)4.4%
ROA(5y)4.97%
ROE(3y)17.84%
ROE(5y)21.35%
ROIC(3y)7.15%
ROIC(5y)7.43%
1.3 Margins
BAC has a Profit Margin of 13.14%. This is in the better half of the industry: BAC outperforms 78.57% of its industry peers.
In the last couple of years the Profit Margin of BAC has declined.
The Operating Margin of BAC (23.68%) is better than 85.71% of its industry peers.
BAC's Operating Margin has been stable in the last couple of years.
BAC has a Gross Margin (60.02%) which is in line with its industry peers.
BAC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.68% | ||
| PM (TTM) | 13.14% | ||
| GM | 60.02% |
OM growth 3Y-0.77%
OM growth 5Y0.34%
PM growth 3Y-7.69%
PM growth 5Y-2.33%
GM growth 3Y1.22%
GM growth 5Y0.51%
2. Health
2.1 Basic Checks
BAC has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
BAC has about the same amout of shares outstanding than it did 1 year ago.
BAC has more shares outstanding than it did 5 years ago.
BAC has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.29, we must say that BAC is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.29, BAC perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
BAC has a debt to FCF ratio of 7.12. This is a slightly negative value and a sign of low solvency as BAC would need 7.12 years to pay back of all of its debts.
BAC has a better Debt to FCF ratio (7.12) than 64.29% of its industry peers.
A Debt/Equity ratio of 1.20 is on the high side and indicates that BAC has dependencies on debt financing.
The Debt to Equity ratio of BAC (1.20) is worse than 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 7.12 | ||
| Altman-Z | 1.29 |
ROIC/WACC1.2
WACC6.25%
2.3 Liquidity
A Current Ratio of 0.61 indicates that BAC may have some problems paying its short term obligations.
BAC has a worse Current ratio (0.61) than 71.43% of its industry peers.
BAC has a Quick Ratio of 0.61. This is a bad value and indicates that BAC is not financially healthy enough and could expect problems in meeting its short term obligations.
BAC has a worse Quick ratio (0.58) than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
BAC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.64%.
The Earnings Per Share has been decreasing by -0.93% on average over the past years.
Looking at the last year, BAC shows a small growth in Revenue. The Revenue has grown by 0.93% in the last year.
BAC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.44% yearly.
EPS 1Y (TTM)-0.64%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%3.48%
Revenue 1Y (TTM)0.93%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.53%
3.2 Future
Based on estimates for the next years, BAC will show a small growth in Earnings Per Share. The EPS will grow by 4.26% on average per year.
Based on estimates for the next years, BAC will show a small growth in Revenue. The Revenue will grow by 1.81% on average per year.
EPS Next Y4.9%
EPS Next 2Y4.44%
EPS Next 3Y4.42%
EPS Next 5Y4.26%
Revenue Next Year2.1%
Revenue Next 2Y2.03%
Revenue Next 3Y1.84%
Revenue Next 5Y1.81%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 9.50 indicates a reasonable valuation of BAC.
Based on the Price/Earnings ratio, BAC is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 24.21. BAC is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 8.79, the valuation of BAC can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BAC indicates a rather cheap valuation: BAC is cheaper than 89.29% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.44. BAC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.5 | ||
| Fwd PE | 8.79 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as BAC.
75.00% of the companies in the same industry are more expensive than BAC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.19 | ||
| EV/EBITDA | 6.52 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates BAC does not grow enough to justify the current Price/Earnings ratio.
BAC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.94
PEG (5Y)N/A
EPS Next 2Y4.44%
EPS Next 3Y4.42%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.21%, BAC is a good candidate for dividend investing.
BAC's Dividend Yield is rather good when compared to the industry average which is at 4.55. BAC pays more dividend than 92.86% of the companies in the same industry.
BAC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.21% |
5.2 History
The dividend of BAC has a limited annual growth rate of 1.99%.
Dividend Growth(5Y)1.99%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
63.59% of the earnings are spent on dividend by BAC. This is not a sustainable payout ratio.
The dividend of BAC is growing, but earnings are growing more, so the dividend growth is sustainable.
DP63.59%
EPS Next 2Y4.44%
EPS Next 3Y4.42%
FRA:BAC (5/9/2025, 7:00:00 PM)
38.955
+0.11 (+0.28%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners65.92%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap164.23B
Analysts73.71
Price Target42.83 (9.95%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.21% |
Yearly Dividend2.38
Dividend Growth(5Y)1.99%
DP63.59%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.9%
Min EPS beat(2)-2.47%
Max EPS beat(2)0.67%
EPS beat(4)1
Avg EPS beat(4)-1.56%
Min EPS beat(4)-2.67%
Max EPS beat(4)0.67%
EPS beat(8)3
Avg EPS beat(8)-0.94%
EPS beat(12)3
Avg EPS beat(12)-1.41%
EPS beat(16)5
Avg EPS beat(16)-1.1%
Revenue beat(2)0
Avg Revenue beat(2)-2.06%
Min Revenue beat(2)-2.21%
Max Revenue beat(2)-1.92%
Revenue beat(4)0
Avg Revenue beat(4)-2.76%
Min Revenue beat(4)-3.7%
Max Revenue beat(4)-1.92%
Revenue beat(8)0
Avg Revenue beat(8)-2.96%
Revenue beat(12)0
Avg Revenue beat(12)-2.94%
Revenue beat(16)1
Avg Revenue beat(16)-2.78%
PT rev (1m)-3.11%
PT rev (3m)-5.74%
EPS NQ rev (1m)-0.09%
EPS NQ rev (3m)0.37%
EPS NY rev (1m)0.1%
EPS NY rev (3m)0.13%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)0.14%
Revenue NY rev (1m)0.42%
Revenue NY rev (3m)0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.5 | ||
| Fwd PE | 8.79 | ||
| P/S | 1.37 | ||
| P/FCF | 9.19 | ||
| P/OCF | 4.93 | ||
| P/B | 1.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.52 |
EPS(TTM)4.1
EY10.52%
EPS(NY)4.43
Fwd EY11.38%
FCF(TTM)4.24
FCFY10.88%
OCF(TTM)7.9
OCFY20.27%
SpS28.41
BVpS21.15
TBVpS-18.83
PEG (NY)1.94
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.68% | ||
| ROE | 17.66% | ||
| ROCE | 10.03% | ||
| ROIC | 7.49% | ||
| ROICexc | 7.54% | ||
| ROICexgc | 18.89% | ||
| OM | 23.68% | ||
| PM (TTM) | 13.14% | ||
| GM | 60.02% | ||
| FCFM | 14.91% |
ROA(3y)4.4%
ROA(5y)4.97%
ROE(3y)17.84%
ROE(5y)21.35%
ROIC(3y)7.15%
ROIC(5y)7.43%
ROICexc(3y)7.22%
ROICexc(5y)7.63%
ROICexgc(3y)17.6%
ROICexgc(5y)17.93%
ROCE(3y)9.58%
ROCE(5y)9.96%
ROICexcg growth 3Y0.43%
ROICexcg growth 5Y-0.86%
ROICexc growth 3Y-0.4%
ROICexc growth 5Y-4.26%
OM growth 3Y-0.77%
OM growth 5Y0.34%
PM growth 3Y-7.69%
PM growth 5Y-2.33%
GM growth 3Y1.22%
GM growth 5Y0.51%
F-Score7
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 7.12 | ||
| Debt/EBITDA | 2.42 | ||
| Cap/Depr | 96.72% | ||
| Cap/Sales | 12.88% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 75.13% | ||
| Profit Quality | 113.47% | ||
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.58 | ||
| Altman-Z | 1.29 |
F-Score7
WACC6.25%
ROIC/WACC1.2
Cap/Depr(3y)132.1%
Cap/Depr(5y)187.34%
Cap/Sales(3y)17.07%
Cap/Sales(5y)23.57%
Profit Quality(3y)89.4%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-0.64%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%3.48%
EPS Next Y4.9%
EPS Next 2Y4.44%
EPS Next 3Y4.42%
EPS Next 5Y4.26%
Revenue 1Y (TTM)0.93%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.53%
Revenue Next Year2.1%
Revenue Next 2Y2.03%
Revenue Next 3Y1.84%
Revenue Next 5Y1.81%
EBIT growth 1Y5.56%
EBIT growth 3Y-0.48%
EBIT growth 5Y0.78%
EBIT Next Year70.37%
EBIT Next 3Y21.62%
EBIT Next 5Y13.35%
FCF growth 1Y55.55%
FCF growth 3YN/A
FCF growth 5Y2.28%
OCF growth 1Y-2.59%
OCF growth 3Y-2.27%
OCF growth 5Y0.64%