VERIZON COMMUNICATIONS INC (VZ) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VZ - US92343V1044 - Common Stock
39.24 USD
+0.16 (+0.41%)
39.25 USD
+0.01 (+0.03%)
VZ gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 37 industry peers in the Diversified Telecommunication Services industry. While VZ belongs to the best of the industry regarding profitability, there are concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on VZ. Finally VZ also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year VZ was profitable.
- In the past year VZ had a positive cash flow from operations.
- VZ had positive earnings in each of the past 5 years.
- Each year in the past 5 years VZ had a positive operating cash flow.
1.2 Ratios
- VZ has a Return On Assets of 5.11%. This is in the better half of the industry: VZ outperforms 75.68% of its industry peers.
- VZ's Return On Equity of 18.88% is amongst the best of the industry. VZ outperforms 81.08% of its industry peers.
- VZ's Return On Invested Capital of 7.38% is amongst the best of the industry. VZ outperforms 81.08% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for VZ is in line with the industry average of 6.52%.
- The 3 year average ROIC (7.15%) for VZ is below the current ROIC(7.38%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.11% | ||
| ROE | 18.88% | ||
| ROIC | 7.38% |
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
- The Profit Margin of VZ (14.43%) is better than 78.38% of its industry peers.
- In the last couple of years the Profit Margin of VZ has declined.
- The Operating Margin of VZ (23.63%) is better than 89.19% of its industry peers.
- In the last couple of years the Operating Margin of VZ has remained more or less at the same level.
- VZ has a Gross Margin of 59.41%. This is comparable to the rest of the industry: VZ outperforms 54.05% of its industry peers.
- VZ's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.63% | ||
| PM (TTM) | 14.43% | ||
| GM | 59.41% |
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
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so VZ is still creating some value.
- VZ has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, VZ has more shares outstanding
- Compared to 1 year ago, VZ has an improved debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 1.27, we must say that VZ is in the distress zone and has some risk of bankruptcy.
- VZ's Altman-Z score of 1.27 is fine compared to the rest of the industry. VZ outperforms 75.68% of its industry peers.
- VZ has a debt to FCF ratio of 7.11. This is a slightly negative value and a sign of low solvency as VZ would need 7.11 years to pay back of all of its debts.
- The Debt to FCF ratio of VZ (7.11) is better than 72.97% of its industry peers.
- VZ has a Debt/Equity ratio of 1.21. This is a high value indicating a heavy dependency on external financing.
- VZ's Debt to Equity ratio of 1.21 is in line compared to the rest of the industry. VZ outperforms 45.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 7.11 | ||
| Altman-Z | 1.27 |
ROIC/WACC1.22
WACC6.04%
2.3 Liquidity
- VZ has a Current Ratio of 0.74. This is a bad value and indicates that VZ is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Current ratio of VZ (0.74) is worse than 83.78% of its industry peers.
- VZ has a Quick Ratio of 0.74. This is a bad value and indicates that VZ is not financially healthy enough and could expect problems in meeting its short term obligations.
- With a Quick ratio value of 0.69, VZ is not doing good in the industry: 83.78% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
- VZ shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.28%.
- The Earnings Per Share has been decreasing by -0.93% on average over the past years.
- VZ shows a small growth in Revenue. In the last year, the Revenue has grown by 2.42%.
- Measured over the past years, VZ shows a small growth in Revenue. The Revenue has been growing by 0.44% on average per year.
EPS 1Y (TTM)3.28%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%1.68%
Revenue 1Y (TTM)2.42%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.47%
3.2 Future
- Based on estimates for the next years, VZ will show a small growth in Earnings Per Share. The EPS will grow by 3.70% on average per year.
- The Revenue is expected to grow by 1.73% on average over the next years.
EPS Next Y5.15%
EPS Next 2Y3.5%
EPS Next 3Y3.86%
EPS Next 5Y3.7%
Revenue Next Year2.57%
Revenue Next 2Y2.19%
Revenue Next 3Y1.77%
Revenue Next 5Y1.73%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 8.31, the valuation of VZ can be described as reasonable.
- Based on the Price/Earnings ratio, VZ is valued cheaper than 94.59% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.32, VZ is valued rather cheaply.
- VZ is valuated cheaply with a Price/Forward Earnings ratio of 7.98.
- VZ's Price/Forward Earnings ratio is rather cheap when compared to the industry. VZ is cheaper than 97.30% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.30, VZ is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.31 | ||
| Fwd PE | 7.98 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VZ indicates a somewhat cheap valuation: VZ is cheaper than 78.38% of the companies listed in the same industry.
- VZ's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. VZ is cheaper than 64.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.01 | ||
| EV/EBITDA | 5.98 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of VZ may justify a higher PE ratio.
PEG (NY)1.61
PEG (5Y)N/A
EPS Next 2Y3.5%
EPS Next 3Y3.86%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 7.01%, VZ is a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 2.33, VZ pays a better dividend. On top of this VZ pays more dividend than 89.19% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.86, VZ pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.01% |
5.2 History
- The dividend of VZ has a limited annual growth rate of 1.99%.
- VZ has paid a dividend for at least 10 years, which is a reliable track record.
- VZ has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.99%
Div Incr Years20
Div Non Decr Years24
5.3 Sustainability
- VZ pays out 57.56% of its income as dividend. This is a bit on the high side, but may be sustainable.
- The dividend of VZ is growing, but earnings are growing more, so the dividend growth is sustainable.
DP57.56%
EPS Next 2Y3.5%
EPS Next 3Y3.86%
39.24
+0.16 (+0.41%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)10-29 2025-10-29/bmo
Earnings (Next)01-30 2026-01-30/amc
Inst Owners69.03%
Inst Owner Change0.13%
Ins Owners0.01%
Ins Owner Change0%
Market Cap165.45B
Revenue(TTM)137.49B
Net Income(TTM)19.84B
Analysts72.73
Price Target49 (24.87%)
Short Float %2.82%
Short Ratio4.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.01% |
Yearly Dividend2.67
Dividend Growth(5Y)1.99%
DP57.56%
Div Incr Years20
Div Non Decr Years24
Ex-Date01-12 2026-01-12 (0.69)
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.6%
Min EPS beat(2)-1.2%
Max EPS beat(2)0.01%
EPS beat(4)2
Avg EPS beat(4)-0.75%
Min EPS beat(4)-2.47%
Max EPS beat(4)0.67%
EPS beat(8)2
Avg EPS beat(8)-1.26%
EPS beat(12)4
Avg EPS beat(12)-1.17%
EPS beat(16)4
Avg EPS beat(16)-1.35%
Revenue beat(2)0
Avg Revenue beat(2)-2.47%
Min Revenue beat(2)-4.22%
Max Revenue beat(2)-0.71%
Revenue beat(4)0
Avg Revenue beat(4)-2.26%
Min Revenue beat(4)-4.22%
Max Revenue beat(4)-0.71%
Revenue beat(8)0
Avg Revenue beat(8)-2.64%
Revenue beat(12)0
Avg Revenue beat(12)-2.99%
Revenue beat(16)0
Avg Revenue beat(16)-2.87%
PT rev (1m)1.75%
PT rev (3m)-0.58%
EPS NQ rev (1m)-0.74%
EPS NQ rev (3m)-2.97%
EPS NY rev (1m)-0.06%
EPS NY rev (3m)-0.29%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-0.49%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.31 | ||
| Fwd PE | 7.98 | ||
| P/S | 1.2 | ||
| P/FCF | 8.01 | ||
| P/OCF | 4.3 | ||
| P/B | 1.58 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.98 |
EPS(TTM)4.72
EY12.03%
EPS(NY)4.92
Fwd EY12.53%
FCF(TTM)4.9
FCFY12.48%
OCF(TTM)9.12
OCFY23.24%
SpS32.61
BVpS24.91
TBVpS-20.22
PEG (NY)1.61
PEG (5Y)N/A
Graham Number51.44
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.11% | ||
| ROE | 18.88% | ||
| ROCE | 9.88% | ||
| ROIC | 7.38% | ||
| ROICexc | 7.55% | ||
| ROICexgc | 18.55% | ||
| OM | 23.63% | ||
| PM (TTM) | 14.43% | ||
| GM | 59.41% | ||
| FCFM | 15.02% |
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%
ROICexgc growth 3Y0.43%
ROICexgc 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 Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.21 | ||
| Debt/FCF | 7.11 | ||
| Debt/EBITDA | 2.49 | ||
| Cap/Depr | 97.11% | ||
| Cap/Sales | 12.95% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 75.66% | ||
| Profit Quality | 104.09% | ||
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 1.27 |
F-Score7
WACC6.04%
ROIC/WACC1.22
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)3.28%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%1.68%
EPS Next Y5.15%
EPS Next 2Y3.5%
EPS Next 3Y3.86%
EPS Next 5Y3.7%
Revenue 1Y (TTM)2.42%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.47%
Revenue Next Year2.57%
Revenue Next 2Y2.19%
Revenue Next 3Y1.77%
Revenue Next 5Y1.73%
EBIT growth 1Y4.25%
EBIT growth 3Y-0.48%
EBIT growth 5Y0.78%
EBIT Next Year70.43%
EBIT Next 3Y21.43%
EBIT Next 5Y13.55%
FCF growth 1Y50.97%
FCF growth 3YN/A
FCF growth 5Y2.28%
OCF growth 1Y1.89%
OCF growth 3Y-2.27%
OCF growth 5Y0.64%
VERIZON COMMUNICATIONS INC / VZ FAQ
What is the fundamental rating for VZ stock?
ChartMill assigns a fundamental rating of 5 / 10 to VZ.
What is the valuation status of VERIZON COMMUNICATIONS INC (VZ) stock?
ChartMill assigns a valuation rating of 7 / 10 to VERIZON COMMUNICATIONS INC (VZ). This can be considered as Undervalued.
Can you provide the profitability details for VERIZON COMMUNICATIONS INC?
VERIZON COMMUNICATIONS INC (VZ) has a profitability rating of 7 / 10.
What is the financial health of VERIZON COMMUNICATIONS INC (VZ) stock?
The financial health rating of VERIZON COMMUNICATIONS INC (VZ) is 3 / 10.
How sustainable is the dividend of VERIZON COMMUNICATIONS INC (VZ) stock?
The dividend rating of VERIZON COMMUNICATIONS INC (VZ) is 8 / 10 and the dividend payout ratio is 57.56%.