VERIZON COMMUNICATIONS INC (BAC.DE) Stock Fundamental Analysis
Europe - FRA:BAC - US92343V1044 - Common Stock
34.645 EUR
+0.19 (+0.54%)
We assign a fundamental rating of 5 out of 10 to BAC. BAC was compared to 33 industry peers in the Diversified Telecommunication Services industry. While BAC has a great profitability rating, there are quite some concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on BAC. BAC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
BAC had positive earnings in the past year.
BAC had a positive operating cash flow in the past year.
Each year in the past 5 years BAC has been profitable.
BAC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.75%, BAC belongs to the top of the industry, outperforming 84.85% of the companies in the same industry.
The Return On Equity of BAC (17.65%) is better than 78.79% of its industry peers.
Looking at the Return On Invested Capital, with a value of 7.50%, BAC is in the better half of the industry, outperforming 72.73% 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 7.55%.
The 3 year average ROIC (7.15%) for BAC is below the current ROIC(7.50%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.75% | ||
| ROE | 17.65% | ||
| ROIC | 7.5% |
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 13.28%. This is amongst the best in the industry. BAC outperforms 87.88% of its industry peers.
In the last couple of years the Profit Margin of BAC has declined.
BAC's Operating Margin of 23.62% is amongst the best of the industry. BAC outperforms 90.91% of its industry peers.
In the last couple of years the Operating Margin of BAC has remained more or less at the same level.
BAC has a Gross Margin (59.48%) which is in line with its industry peers.
In the last couple of years the Gross Margin of BAC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.62% | ||
| PM (TTM) | 13.28% | ||
| GM | 59.48% |
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.
Compared to 1 year ago, BAC has about the same amount of shares outstanding.
The number of shares outstanding for BAC has been increased compared to 5 years ago.
BAC has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.27, we must say that BAC is in the distress zone and has some risk of bankruptcy.
BAC has a Altman-Z score (1.27) which is in line with its industry peers.
BAC has a debt to FCF ratio of 7.45. This is a slightly negative value and a sign of low solvency as BAC would need 7.45 years to pay back of all of its debts.
BAC's Debt to FCF ratio of 7.45 is fine compared to the rest of the industry. BAC outperforms 60.61% 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.
BAC has a Debt to Equity ratio (1.20) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 7.45 | ||
| Altman-Z | 1.27 |
ROIC/WACC1.31
WACC5.73%
2.3 Liquidity
BAC has a Current Ratio of 0.64. 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's Current ratio of 0.64 is on the low side compared to the rest of the industry. BAC is outperformed by 66.67% of its industry peers.
A Quick Ratio of 0.60 indicates that BAC may have some problems paying its short term obligations.
The Quick ratio of BAC (0.60) is worse than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.17% over the past year.
Measured over the past years, BAC shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.93% on average per year.
The Revenue has been growing slightly by 2.05% in the past year.
Measured over the past years, BAC shows a small growth in Revenue. The Revenue has been growing by 0.44% on average per year.
EPS 1Y (TTM)2.17%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%6.09%
Revenue 1Y (TTM)2.05%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%5.21%
3.2 Future
The Earnings Per Share is expected to grow by 4.79% on average over the next years.
The Revenue is expected to grow by 1.95% on average over the next years.
EPS Next Y5.46%
EPS Next 2Y4.5%
EPS Next 3Y4.29%
EPS Next 5Y4.79%
Revenue Next Year2.84%
Revenue Next 2Y2.45%
Revenue Next 3Y2.05%
Revenue Next 5Y1.95%
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
With a Price/Earnings ratio of 8.53, the valuation of BAC can be described as very reasonable.
93.94% of the companies in the same industry are more expensive than BAC, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.50. BAC is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 8.00 indicates a rather cheap valuation of BAC.
Based on the Price/Forward Earnings ratio, BAC is valued cheaply inside the industry as 90.91% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.99. BAC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.53 | ||
| Fwd PE | 8 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BAC is valued a bit cheaper than 63.64% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of BAC indicates a somewhat cheap valuation: BAC is cheaper than 78.79% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.62 | ||
| EV/EBITDA | 6.15 |
4.3 Compensation for Growth
BAC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of BAC may justify a higher PE ratio.
PEG (NY)1.56
PEG (5Y)N/A
EPS Next 2Y4.5%
EPS Next 3Y4.29%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.76%, BAC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.42, BAC pays a better dividend. On top of this BAC pays more dividend than 93.94% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, BAC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.76% |
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
62.46% of the earnings are spent on dividend by BAC. This is not a sustainable payout ratio.
BAC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP62.46%
EPS Next 2Y4.5%
EPS Next 3Y4.29%
FRA:BAC (10/14/2025, 5:19:10 PM)
34.645
+0.19 (+0.54%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners67.92%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap146.07B
Analysts72.94
Price Target42.06 (21.4%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.76% |
Yearly Dividend2.31
Dividend Growth(5Y)1.99%
DP62.46%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)0.34%
Min EPS beat(2)0.01%
Max EPS beat(2)0.67%
EPS beat(4)2
Avg EPS beat(4)-0.89%
Min EPS beat(4)-2.47%
Max EPS beat(4)0.67%
EPS beat(8)3
Avg EPS beat(8)-1.05%
EPS beat(12)4
Avg EPS beat(12)-1.09%
EPS beat(16)5
Avg EPS beat(16)-1.25%
Revenue beat(2)0
Avg Revenue beat(2)-1.46%
Min Revenue beat(2)-2.2%
Max Revenue beat(2)-0.71%
Revenue beat(4)0
Avg Revenue beat(4)-2.01%
Min Revenue beat(4)-3.21%
Max Revenue beat(4)-0.71%
Revenue beat(8)0
Avg Revenue beat(8)-2.45%
Revenue beat(12)0
Avg Revenue beat(12)-2.77%
Revenue beat(16)0
Avg Revenue beat(16)-2.84%
PT rev (1m)-1.09%
PT rev (3m)-0.62%
EPS NQ rev (1m)-0.15%
EPS NQ rev (3m)-0.19%
EPS NY rev (1m)0.1%
EPS NY rev (3m)0.54%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)0.65%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.53 | ||
| Fwd PE | 8 | ||
| P/S | 1.23 | ||
| P/FCF | 8.62 | ||
| P/OCF | 4.56 | ||
| P/B | 1.64 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.15 |
EPS(TTM)4.06
EY11.72%
EPS(NY)4.33
Fwd EY12.51%
FCF(TTM)4.02
FCFY11.6%
OCF(TTM)7.61
OCFY21.95%
SpS28.09
BVpS21.13
TBVpS-17.88
PEG (NY)1.56
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.75% | ||
| ROE | 17.65% | ||
| ROCE | 10.04% | ||
| ROIC | 7.5% | ||
| ROICexc | 7.58% | ||
| ROICexgc | 18.79% | ||
| OM | 23.62% | ||
| PM (TTM) | 13.28% | ||
| GM | 59.48% | ||
| FCFM | 14.31% |
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 | 7.45 | ||
| Debt/EBITDA | 2.45 | ||
| Cap/Depr | 96.24% | ||
| Cap/Sales | 12.77% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.41% | ||
| Profit Quality | 107.77% | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 1.27 |
F-Score7
WACC5.73%
ROIC/WACC1.31
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)2.17%
EPS 3Y-5.27%
EPS 5Y-0.93%
EPS Q2Q%6.09%
EPS Next Y5.46%
EPS Next 2Y4.5%
EPS Next 3Y4.29%
EPS Next 5Y4.79%
Revenue 1Y (TTM)2.05%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%5.21%
Revenue Next Year2.84%
Revenue Next 2Y2.45%
Revenue Next 3Y2.05%
Revenue Next 5Y1.95%
EBIT growth 1Y5.16%
EBIT growth 3Y-0.48%
EBIT growth 5Y0.78%
EBIT Next Year71.37%
EBIT Next 3Y21.64%
EBIT Next 5Y13.82%
FCF growth 1Y58.54%
FCF growth 3YN/A
FCF growth 5Y2.28%
OCF growth 1Y-1.06%
OCF growth 3Y-2.27%
OCF growth 5Y0.64%