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VEON Ltd (VEON)
:VEON
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VEON
(NASDAQ:VEON)
63Neutral
Positive Factors
Debt Management
VEON now has very modest debt risk with net debt to EBITDA at 1.34x and cash and sales proceeds on hand to meet 2025 debt maturities.
Digital Revenue Growth
VEON is a premier frontier markets mobile play complemented by breakout digital revenue growth for fintech, health, and entertainment apps.
Strategic Expansion
VEON's Jazz operation in Pakistan is considered a highly appealing prospective public listing due to its leadership in mobile and fintech.
Negative Factors
Market Dependency
VEON is regarded as a top frontier markets mobile play with a focus on markets like Ukraine and Pakistan.
Regional Conflict
Any interim settlement in the Ukrainian conflict is likely to be positive for VEON and its Ukrainian Kyivstar business, which is a significant national asset.
VEON (VEON) vs. S&P 500 (SPY)
Market Cap
$3.23B
Dividend YieldN/A
Average Volume (3M)114.79K
Price to Earnings (P/E)7.8
Beta (1Y)0.57
Revenue Growth8.27%
EPS GrowthN/A
CountryUS
Employees18,027
SectorCommunication Services
Sector Strength83
IndustryTelecommunications Services
Share Statistics
EPS (TTM)5.88
Shares Outstanding73,967,630
10 Day Avg. Volume127,141
30 Day Avg. Volume114,794
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.75
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit1.73
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$60.00Price Target Upside31.41% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
VEON Business Overview & Revenue Model
Company DescriptionVEON Ltd., through its subsidiaries, provides mobile and fixed-line telecommunications services. It offers voice, data, and other telecommunication services through a range of wireless, fixed, and broadband internet services. The company provides value-added services, including short messages, multimedia messages, caller number identification, call waiting, data transmission, mobile internet, downloadable content, mobile finance, machine-to-machine, and other services; national and international roaming services; wireless internet access; and mobile bundles and call completion services. It also offers value-added services for corporations, operators, and consumers, as well as sells equipment and accessories. The company provides its services under the Beeline, Kyivstar, Jazz, Djezzy, and banglalink brands in Russia, Pakistan, Algeria, Uzbekistan, Ukraine, Bangladesh, Kazakhstan, Kyrgyzstan, and Georgia. It serves approximately 220 million customers. The company was formerly known as VimpelCom Ltd. and changed its name to VEON Ltd. in March 2017. VEON Ltd. was founded in 1992 and is headquartered in Amsterdam, the Netherlands.
How the Company Makes MoneyVEON generates revenue primarily through its telecommunications services, including mobile voice services, data services, and other digital services. The company earns money from customer subscriptions, prepaid and postpaid plans, and usage-based charges for voice and data services. Additionally, VEON offers value-added services such as digital content, mobile financial services, and enterprise solutions, contributing to its revenue streams. Key factors such as market penetration, competitive pricing strategies, and strategic partnerships with technology providers and local businesses play a significant role in driving VEON's earnings. The company also benefits from its presence in high-growth emerging markets, which helps in expanding its customer base and increasing service usage.
VEON Financial Statement Overview
Summary
VEON demonstrates strong operational efficiency with high gross profit and EBITDA margins, yet faces headwinds from declining revenues and significant net losses, impacting net profit margins. The high reliance on debt presents financial risks, although strong free cash flow generation offers some mitigation.Income Statement
The company experienced a significant decline in total revenue from $3.755 billion in 2022 to $3.698 billion in 2023, indicating a negative growth trajectory. The gross profit margin is relatively high at 88%, but the net profit margin is deeply negative due to a substantial net loss in 2023. EBIT and EBITDA margins are strong at 25% and 49% respectively, pointing to operational efficiencies despite the revenue drop and net income challenges.50
Neutral
Balance Sheet
The debt-to-equity ratio is high at 5.55 in 2023, indicating a significant reliance on debt financing, which poses a risk. However, the company has managed to increase its stockholders' equity over the year. The equity ratio is relatively low at 10%, implying limited equity buffer, although the return on equity is negative due to the net loss.45
Neutral
Cash Flow
The company has maintained positive free cash flow, with a slight increase from 2022 to 2023, reflecting strong cash generation capability. The operating cash flow to net income ratio is high due to the negative net income, which indicates operational cash generation is not translating into profitability. The free cash flow to net income ratio is positive due to positive free cash flow despite net losses.60
Neutral
| Breakdown | ||||
| Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.70B | 3.75B | 7.79B | 7.98B | 8.86B | Gross Profit |
| 3.26B | 3.28B | 5.91B | 6.09B | 6.83B | EBIT |
| 929.00M | 1.04B | 1.54B | 1.67B | 2.02B | EBITDA |
| 1.82B | 2.16B | 1.85B | 2.33B | 4.12B | Net Income Common Stockholders |
| -2.53B | 737.00M | 674.00M | -316.00M | 621.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 2.33B | 4.01B | 2.34B | 1.76B | 1.33B | Total Assets |
| 8.22B | 15.10B | 15.92B | 14.55B | 16.06B | Total Debt |
| 0.00 | 7.57B | 10.65B | 10.06B | 10.34B | Net Debt |
| -1.90B | 4.46B | 8.39B | 8.46B | 9.09B | Total Liabilities |
| 7.15B | 14.32B | 14.42B | 13.54B | 13.84B | Stockholders Equity |
| 858.00M | 776.00M | 586.00M | 163.00M | 1.23B |
| Cash Flow | Free Cash Flow | |||
| 1.58B | 1.55B | 843.00M | 665.00M | 1.27B | Operating Cash Flow |
| 2.11B | 2.56B | 2.64B | 2.44B | 2.95B | Investing Cash Flow |
| -2.24B | -1.66B | -1.18B | -1.91B | -1.89B | Financing Cash Flow |
| -1.15B | 116.00M | -744.00M | -103.00M | -1.64B |
VEON Technical Analysis
Positive
45.66
Price Trends
43.47
Positive
42.64
Positive
36.12
Positive
Market Momentum
0.62
Negative
58.77
Neutral
54.81
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VEON, the sentiment is Positive. The current price of 45.66 is above the 20-day moving average (MA) of 42.15, above the 50-day MA of 43.47, and above the 200-day MA of 36.12, indicating a bullish trend. The MACD of 0.62 indicates Negative momentum. The RSI at 58.77 is Neutral, neither overbought nor oversold. The STOCH value of 54.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VEON.
VEON Risk Analysis
VEON disclosed 54 risk factors in its most recent earnings report. VEON reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
VEON Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $5.09B | 11.49 | 6.76% | 2.61% | 8.78% | -21.85% | |
64 Neutral | $4.20B | 4.30 | 23.27% | ― | -26.74% | ― | |
63 Neutral | $3.23B | 7.78 | 42.31% | ― | 8.27% | ― | |
59 Neutral | $13.76B | 7.64 | -1.94% | 3.86% | 2.38% | -36.56% | |
56 Neutral | $1.66B | ― | 493.63% | ― | -19.49% | 16.08% | |
52 Neutral | $657.19M | ― | -4.05% | 0.87% | 14.16% | -443.30% | |
51 Neutral | $570.24M | ― | -12.42% | ― | 1.91% | 15.71% |
* Communication Services Sector Average
Performance Comparison
VEON
VEON
45.71
20.91
84.31%
SHEN
Shenandoah Telecommunications Co
11.98
-1.40
-10.46%
RBBN
Ribbon Communications
3.24
0.07
2.21%
TEO
Telecom Argentina
9.18
0.79
9.42%
TKC
Turkcell Iletisim
5.87
-0.26
-4.24%
IHS
IHS Holding
4.90
1.10
28.95%
VEON Earnings Call Summary
Earnings Call Date:Mar 20, 2025
(Q4-2024)
| % Change Since: -0.61%|
Next Earnings Date:May 15, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment with strong revenue and EBITDA growth surpassing expectations, significant strides in digital services, and a strengthened financial position. However, challenges such as political unrest in Bangladesh and increased capital expenditure in Ukraine present notable concerns.Q4-2024 Updates
Positive Updates
Strong Revenue and EBITDA Growth
VEON delivered 8.3% revenue growth in US dollars for 2024, exceeding the 8% to 10% growth expectations. EBITDA grew 4.9% in US dollars, also surpassing the 4% to 6% expectations. In local currency terms, revenue grew 14.6% and EBITDA by 12%.
Digital Services Expansion
Direct digital revenues grew by 63% for the full year and by 42% year-on-year in Q4, comprising 12.6% of total revenues. This highlights VEON's successful evolution into a services company with a telco license.
Improved Financial Position
The net debt to EBITDA ratio improved to 1.3 from over 3 times pre-Russia exit. Cash reserves rose by 65.6% quarter-on-quarter to $1.7 billion, ensuring readiness to redeem 2025 debt maturities.
Successful Asset-Light Strategy
VEON's asset-light strategy led to significant value unlocking, including the completion of Phase 1 of a $100 million share buyback program and the sale of assets like TNS+.
Strategic Acquisitions and Market Expansion
Acquired 97% of Uklon, Ukraine’s leading ride-hailing business, valued at $160 million. The acquisition aligns with VEON's strategy to expand digital services.
Negative Updates
Challenges in Bangladesh
Political changes and macroeconomic challenges heavily impacted performance in Bangladesh, affecting customer sentiment and revenue stability.
Impact of Cyberattack and Political Unrest
Financials were affected by a cyberattack in Ukraine and political unrest in Bangladesh, leading to restructuring costs and challenges in maintaining operational stability.
Increased Capital Intensity
Capital intensity for the year was 20.6%, exceeding the guidance of 18% to 19%, primarily due to escalated investments in Ukraine amidst the war.
Company Guidance
During the call, VEON provided detailed guidance for 2025, highlighting expected revenue growth of 12% to 14% in local currency terms and EBITDA growth projected at 13% to 15%. The company anticipates a capital expenditure intensity between 17% and 19%, a decrease from 2024's 20.6% due to escalated investments in Ukraine. VEON's 2024 revenue grew 8.3% in U.S. dollar terms and 14.6% in local currency, with direct digital revenues increasing by 63% to $460 million. The company also reported a significant improvement in its net debt to EBITDA ratio, reducing it to 1.3 times. Revenue guidance for 2025 factors in a blended weighted average inflation rate of 8.2%, with a focus on leveraging digital services and asset-light strategies to sustain growth amidst macroeconomic challenges.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.