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 has a correct valuation and a medium 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.
Each year in the past 5 years BAC has been profitable.
In the past 5 years BAC always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 4.68%, BAC is doing good in the industry, outperforming 78.57% of the companies in the same industry.
Looking at the Return On Equity, with a value of 17.66%, BAC is in the better half of the industry, outperforming 78.57% 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 71.43% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for BAC is in line with the industry average of 7.49%.
The 3 year average ROIC (7.15%) for BAC is below the current ROIC(7.49%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 13.14%, BAC belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
In the last couple of years the Profit Margin of BAC has declined.
The Operating Margin of BAC (23.68%) is better than 89.29% of its industry peers.
BAC's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 60.02%, BAC perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BAC is creating some value.
The number of shares outstanding for BAC remains at a similar level compared to 1 year ago.
The number of shares outstanding for BAC has been increased compared to 5 years ago.
The debt/assets ratio for BAC has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.28, we must say that BAC is in the distress zone and has some risk of bankruptcy.
BAC has a Altman-Z score (1.28) which is comparable to the rest of the 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 Debt to FCF ratio (7.12) which is comparable to the rest of the industry.
BAC has a Debt/Equity ratio of 1.20. This is a high value indicating a heavy dependency on external financing.
BAC's Debt to Equity ratio of 1.20 is on the low side compared to the rest of the industry. BAC is outperformed by 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 7.12 | ||
| Altman-Z | 1.28 |
ROIC/WACC1.26
WACC5.96%
2.3 Liquidity
BAC has a Current 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.
Looking at the Current ratio, with a value of 0.61, BAC is doing worse than 82.14% of the companies in the same industry.
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 82.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.61 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
The earnings per share for BAC have decreased by -0.64% in the last year.
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.
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)-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 4.94% on average per year.
Based on estimates for the next years, BAC will show a small growth in Revenue. The Revenue will grow by 1.83% on average per year.
EPS Next Y5.09%
EPS Next 2Y4.08%
EPS Next 3Y4.07%
EPS Next 5Y4.94%
Revenue Next Year1.98%
Revenue Next 2Y1.86%
Revenue Next 3Y1.7%
Revenue Next 5Y1.83%
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
A Price/Earnings ratio of 9.26 indicates a reasonable valuation of BAC.
BAC's Price/Earnings ratio is rather cheap when compared to the industry. BAC is cheaper than 89.29% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.29. BAC is valued rather cheaply when compared to this.
BAC is valuated reasonably with a Price/Forward Earnings ratio of 8.63.
Based on the Price/Forward Earnings ratio, BAC is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of BAC to the average of the S&P500 Index (21.74), we can say BAC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.26 | ||
| Fwd PE | 8.63 |
4.2 Price Multiples
BAC's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, BAC is valued a bit cheaper than 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.96 | ||
| EV/EBITDA | 6.44 |
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)1.82
PEG (5Y)N/A
EPS Next 2Y4.08%
EPS Next 3Y4.07%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.22%, BAC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.57, BAC pays a better dividend. On top of this BAC pays more dividend than 92.86% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.37, BAC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.22% |
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 2Y4.08%
EPS Next 3Y4.07%
FRA:BAC (7/8/2025, 9:53:44 AM)
36.583
-0.01 (-0.03%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners67.4%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap154.23B
Analysts73.71
Price Target42.32 (15.68%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.22% |
Yearly Dividend2.27
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)-2.2%
Max Revenue beat(2)-1.92%
Revenue beat(4)0
Avg Revenue beat(4)-2.75%
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)-1.2%
PT rev (3m)-4.75%
EPS NQ rev (1m)-0.02%
EPS NQ rev (3m)-0.18%
EPS NY rev (1m)-0.05%
EPS NY rev (3m)0.28%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)0.37%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.26 | ||
| Fwd PE | 8.63 | ||
| P/S | 1.34 | ||
| P/FCF | 8.96 | ||
| P/OCF | 4.81 | ||
| P/B | 1.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.44 |
EPS(TTM)3.95
EY10.8%
EPS(NY)4.24
Fwd EY11.59%
FCF(TTM)4.08
FCFY11.16%
OCF(TTM)7.61
OCFY20.79%
SpS27.36
BVpS20.37
TBVpS-18.14
PEG (NY)1.82
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 | 1.28 |
F-Score7
WACC5.96%
ROIC/WACC1.26
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 Y5.09%
EPS Next 2Y4.08%
EPS Next 3Y4.07%
EPS Next 5Y4.94%
Revenue 1Y (TTM)0.93%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.53%
Revenue Next Year1.98%
Revenue Next 2Y1.86%
Revenue Next 3Y1.7%
Revenue Next 5Y1.83%
EBIT growth 1Y5.56%
EBIT growth 3Y-0.48%
EBIT growth 5Y0.78%
EBIT Next Year70.91%
EBIT Next 3Y21.43%
EBIT Next 5Y13.57%
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%