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 27 industry peers in the Diversified Telecommunication Services industry. While BAC belongs to the best of the industry regarding profitability, there are concerns on its financial health. BAC has a decent growth rate and is not valued too expensively. Finally 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.
In the past 5 years BAC has always 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.
BAC's Return On Equity of 17.66% is fine compared to the rest of the industry. BAC outperforms 78.57% of its industry peers.
BAC has a Return On Invested Capital of 7.49%. This is in the better half of the industry: BAC outperforms 71.43% of its industry peers.
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 7.62%.
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.
BAC's Profit Margin has declined in the last couple of years.
BAC's Operating Margin of 23.68% is amongst the best of the industry. BAC outperforms 89.29% of its industry peers.
BAC's Operating Margin has been stable in the last couple of years.
BAC's Gross Margin of 60.02% is in line compared to the rest of the industry. BAC outperforms 57.14% of 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.
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 1.27, we must say that BAC is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.27, 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.
The Debt to FCF ratio of BAC (7.12) is comparable to the rest of the industry.
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 of 1.20. This is in the lower half of the industry: BAC underperforms 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 7.12 | ||
| Altman-Z | 1.27 |
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.
BAC's Current ratio of 0.61 is on the low side compared to the rest of the industry. BAC is outperformed by 82.14% of its industry peers.
A Quick Ratio of 0.58 indicates that BAC may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.58, BAC is doing worse than 82.14% of the companies in the same industry.
| 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.
The Revenue has been growing slightly by 0.93% in the past year.
The Revenue has been growing slightly by 0.44% on average over the past years.
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
BAC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.94% yearly.
BAC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.83% yearly.
EPS Next Y4.89%
EPS Next 2Y3.96%
EPS Next 3Y4.05%
EPS Next 5Y4.94%
Revenue Next Year2.06%
Revenue Next 2Y2.02%
Revenue Next 3Y1.74%
Revenue Next 5Y1.83%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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 8.86 indicates a reasonable valuation of BAC.
89.29% of the companies in the same industry are more expensive than BAC, based on the Price/Earnings ratio.
BAC's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.50.
BAC is valuated reasonably with a Price/Forward Earnings ratio of 8.27.
BAC's Price/Forward Earnings ratio is rather cheap when compared to the industry. BAC is cheaper than 85.71% of the companies in the same industry.
BAC is valuated cheaply when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.86 | ||
| Fwd PE | 8.27 |
4.2 Price Multiples
BAC's Enterprise Value to EBITDA is on the same level as the industry average.
BAC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. BAC is cheaper than 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.57 | ||
| EV/EBITDA | 6.32 |
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)1.81
PEG (5Y)N/A
EPS Next 2Y3.96%
EPS Next 3Y4.05%
5. Dividend
5.1 Amount
BAC has a Yearly Dividend Yield of 6.45%, which is a nice return.
BAC's Dividend Yield is rather good when compared to the industry average which is at 4.57. 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 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.45% |
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
BAC pays out 63.59% of its income as dividend. This is not a sustainable payout ratio.
BAC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP63.59%
EPS Next 2Y3.96%
EPS Next 3Y4.05%
FRA:BAC (7/18/2025, 7:00:00 PM)
35.105
-0.44 (-1.22%)
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 Cap148.01B
Analysts73.71
Price Target42.32 (20.55%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.45% |
Yearly Dividend2.29
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)-0.88%
PT rev (3m)-4.75%
EPS NQ rev (1m)-0.4%
EPS NQ rev (3m)-0.5%
EPS NY rev (1m)-0.25%
EPS NY rev (3m)0.08%
Revenue NQ rev (1m)0.41%
Revenue NQ rev (3m)0.71%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)0.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.86 | ||
| Fwd PE | 8.27 | ||
| P/S | 1.28 | ||
| P/FCF | 8.57 | ||
| P/OCF | 4.6 | ||
| P/B | 1.72 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.32 |
EPS(TTM)3.96
EY11.28%
EPS(NY)4.25
Fwd EY12.1%
FCF(TTM)4.1
FCFY11.67%
OCF(TTM)7.64
OCFY21.75%
SpS27.47
BVpS20.45
TBVpS-18.21
PEG (NY)1.81
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 | 1.27 |
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 Y4.89%
EPS Next 2Y3.96%
EPS Next 3Y4.05%
EPS Next 5Y4.94%
Revenue 1Y (TTM)0.93%
Revenue growth 3Y0.29%
Revenue growth 5Y0.44%
Sales Q2Q%1.53%
Revenue Next Year2.06%
Revenue Next 2Y2.02%
Revenue Next 3Y1.74%
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%