TELEFONICA SA-SPON ADR (TEF) Stock Fundamental Analysis
NYSE:TEF - New York Stock Exchange, Inc. - US8793822086 - ADR - Currency: USD
We assign a fundamental rating of 3 out of 10 to TEF. TEF was compared to 31 industry peers in the Diversified Telecommunication Services industry. Both the profitability and financial health of TEF have multiple concerns. TEF has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year TEF was profitable.
TEF had a positive operating cash flow in the past year.
Of the past 5 years TEF 4 years were profitable.
Each year in the past 5 years TEF had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of -1.42%, TEF perfoms like the industry average, outperforming 43.33% of the companies in the same industry.
The Return On Equity of TEF (-6.96%) is worse than 60.00% of its industry peers.
TEF has a Return On Invested Capital (4.47%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for TEF is below the industry average of 5.71%.
The 3 year average ROIC (2.62%) for TEF is below the current ROIC(4.47%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.42% | ||
| ROE | -6.96% | ||
| ROIC | 4.47% |
ROA(3y)2.59%
ROA(5y)1.95%
ROE(3y)12.48%
ROE(5y)10.86%
ROIC(3y)2.62%
ROIC(5y)3.17%
1.3 Margins
The Operating Margin of TEF (10.56%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of TEF has declined.
TEF has a worse Gross Margin (48.99%) than 63.33% of its industry peers.
In the last couple of years the Gross Margin of TEF has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.56% | ||
| PM (TTM) | N/A | ||
| GM | 48.99% |
OM growth 3Y-18.41%
OM growth 5Y-15.25%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.4%
GM growth 5Y-1.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TEF is still creating some value.
The number of shares outstanding for TEF has been reduced compared to 1 year ago.
TEF has less shares outstanding than it did 5 years ago.
TEF has a worse debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of TEF is 9.01, which is on the high side as it means it would take TEF, 9.01 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 9.01, TEF is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
A Debt/Equity ratio of 1.85 is on the high side and indicates that TEF has dependencies on debt financing.
With a Debt to Equity ratio value of 1.85, TEF is not doing good in the industry: 70.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 9.01 | ||
| Altman-Z | N/A |
ROIC/WACC1.33
WACC3.36%
2.3 Liquidity
TEF has a Current Ratio of 0.85. This is a bad value and indicates that TEF is not financially healthy enough and could expect problems in meeting its short term obligations.
TEF's Current ratio of 0.85 is on the low side compared to the rest of the industry. TEF is outperformed by 66.67% of its industry peers.
A Quick Ratio of 0.81 indicates that TEF may have some problems paying its short term obligations.
TEF has a worse Quick ratio (0.81) than 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
TEF shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 30.19%, which is quite impressive.
Measured over the past years, TEF shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -13.09% on average per year.
TEF shows a decrease in Revenue. In the last year, the revenue decreased by -0.31%.
The Revenue has been decreasing by -3.55% on average over the past years.
EPS 1Y (TTM)30.19%
EPS 3Y-9.34%
EPS 5Y-13.09%
EPS Q2Q%22.22%
Revenue 1Y (TTM)-0.31%
Revenue growth 3Y-1.91%
Revenue growth 5Y-3.55%
Sales Q2Q%-2.89%
3.2 Future
TEF is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -7.77% yearly.
The Revenue is expected to grow by 1.00% on average over the next years.
EPS Next Y-11.25%
EPS Next 2Y-7.84%
EPS Next 3Y-4.08%
EPS Next 5Y-7.77%
Revenue Next Year0.56%
Revenue Next 2Y0.22%
Revenue Next 3Y0.48%
Revenue Next 5Y1%
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
TEF is valuated reasonably with a Price/Earnings ratio of 9.25.
Compared to the rest of the industry, the Price/Earnings ratio of TEF indicates a rather cheap valuation: TEF is cheaper than 93.33% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.36, TEF is valued rather cheaply.
The Price/Forward Earnings ratio is 13.85, which indicates a correct valuation of TEF.
TEF's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. TEF is cheaper than 70.00% of the companies in the same industry.
TEF is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.65, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.25 | ||
| Fwd PE | 13.85 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TEF indicates a rather cheap valuation: TEF is cheaper than 96.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.67 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
TEF's earnings are expected to decrease with -4.08% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-7.84%
EPS Next 3Y-4.08%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 8.84%, TEF is a good candidate for dividend investing.
TEF's Dividend Yield is rather good when compared to the industry average which is at 4.81. TEF pays more dividend than 96.67% of the companies in the same industry.
TEF's Dividend Yield is rather good when compared to the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.84% |
5.2 History
The dividend of TEF decreases each year by -3.17%.
TEF has been paying a dividend for at least 10 years, so it has a reliable track record.
TEF has decreased its dividend recently.
Dividend Growth(5Y)-3.17%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
TEF has negative earnings and hence a negative payout ratio. The dividend may be in danger.
TEF's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP-130.68%
EPS Next 2Y-7.84%
EPS Next 3Y-4.08%
4.44
-0.02 (-0.45%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners28.66%
Inst Owner Change-90.81%
Ins Owners0.4%
Ins Owner ChangeN/A
Market Cap25.04B
Analysts62.76
Price Target4.45 (0.23%)
Short Float %0.2%
Short Ratio11.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.84% |
Yearly Dividend0.38
Dividend Growth(5Y)-3.17%
DP-130.68%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)27.8%
Min EPS beat(2)19.03%
Max EPS beat(2)36.57%
EPS beat(4)4
Avg EPS beat(4)23.56%
Min EPS beat(4)17.64%
Max EPS beat(4)36.57%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)-0.12%
Min Revenue beat(2)-1.43%
Max Revenue beat(2)1.19%
Revenue beat(4)2
Avg Revenue beat(4)2.12%
Min Revenue beat(4)-1.43%
Max Revenue beat(4)10.07%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.13%
PT rev (3m)-1.16%
EPS NQ rev (1m)13.95%
EPS NQ rev (3m)13.95%
EPS NY rev (1m)2.82%
EPS NY rev (3m)2.82%
Revenue NQ rev (1m)-0.18%
Revenue NQ rev (3m)-0.18%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.25 | ||
| Fwd PE | 13.85 | ||
| P/S | 0.59 | ||
| P/FCF | 4.67 | ||
| P/OCF | 2.27 | ||
| P/B | 1.16 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)0.48
EY10.81%
EPS(NY)0.32
Fwd EY7.22%
FCF(TTM)0.95
FCFY21.39%
OCF(TTM)1.96
OCFY44.09%
SpS7.55
BVpS3.83
TBVpS-1.34
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.42% | ||
| ROE | -6.96% | ||
| ROCE | 5.71% | ||
| ROIC | 4.47% | ||
| ROICexc | 5.06% | ||
| ROICexgc | 8.7% | ||
| OM | 10.56% | ||
| PM (TTM) | N/A | ||
| GM | 48.99% | ||
| FCFM | 12.58% |
ROA(3y)2.59%
ROA(5y)1.95%
ROE(3y)12.48%
ROE(5y)10.86%
ROIC(3y)2.62%
ROIC(5y)3.17%
ROICexc(3y)2.93%
ROICexc(5y)3.55%
ROICexgc(3y)4.84%
ROICexgc(5y)6.23%
ROCE(3y)3.34%
ROCE(5y)4.06%
ROICexcg growth 3Y-21.66%
ROICexcg growth 5Y-22%
ROICexc growth 3Y-21.54%
ROICexc growth 5Y-17.49%
OM growth 3Y-18.41%
OM growth 5Y-15.25%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.4%
GM growth 5Y-1.05%
F-Score5
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 9.01 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 13.35% | ||
| Interest Coverage | -3.07 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | N/A |
F-Score5
WACC3.36%
ROIC/WACC1.33
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)14.62%
Cap/Sales(5y)15.19%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)30.19%
EPS 3Y-9.34%
EPS 5Y-13.09%
EPS Q2Q%22.22%
EPS Next Y-11.25%
EPS Next 2Y-7.84%
EPS Next 3Y-4.08%
EPS Next 5Y-7.77%
Revenue 1Y (TTM)-0.31%
Revenue growth 3Y-1.91%
Revenue growth 5Y-3.55%
Sales Q2Q%-2.89%
Revenue Next Year0.56%
Revenue Next 2Y0.22%
Revenue Next 3Y0.48%
Revenue Next 5Y1%
EBIT growth 1Y0.66%
EBIT growth 3Y-19.97%
EBIT growth 5Y-18.26%
EBIT Next Year253.75%
EBIT Next 3Y51.94%
EBIT Next 5Y30.55%
FCF growth 1Y-12.09%
FCF growth 3Y-2.14%
FCF growth 5Y4.14%
OCF growth 1Y-3.01%
OCF growth 3Y-4.1%
OCF growth 5Y-2.65%