Verizon (VZ) AI Stock Analysis

• Market Cap: $182.06B
• Dividend Yield: 6.28%
• Average Volume (3M): 16.82M
• Price to Earnings (P/E): 10.1
• Beta (1Y): 0.26
• Revenue Growth: 2.05%
• EPS Growth: 61.39%
• Country: US
• Employees: 99,400
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 1.22
• Shares Outstanding: 4,216,324,700
• 10 Day Avg. Volume: 17,063,978
• 30 Day Avg. Volume: 16,820,685
• PEG Ratio: 0.19
• Price to Book (P/B): 1.70
• Price to Sales (P/S): 1.25
• P/FCF Ratio: 8.91
• Enterprise Value/Market Cap: 1.92
• Enterprise Value/Revenue: 2.56
• Enterprise Value/Gross Profit: 5.17
• Enterprise Value/Ebitda: 7.19
• 1Y Price Target: $48.21
• Price Target Upside: 11.65% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 83 Outperform
• Price Target: $52.00 ▲(20.43% Upside)

Verizon's strong financial performance and positive earnings call are the most significant factors driving the score. The company's attractive valuation and positive technical indicators further support a favorable outlook. While the balance sheet shows moderate leverage, it is typical for the industry and does not significantly detract from the overall positive assessment.

Positive Factors

5G Network Expansion

Verizon's focus on 5G technology positions it well for future growth, catering to increasing demand for high-speed connectivity and enhancing its competitive edge.

Strong Cash Flow Generation

Robust free cash flow generation supports Verizon's ability to sustain dividends and invest in growth initiatives, ensuring long-term financial stability.

Strategic AI Initiatives

AI initiatives aim to improve customer retention and reduce churn, enhancing customer experience and operational efficiency, which are crucial for long-term success.

Negative Factors

Elevated Postpaid Churn

High churn rates indicate customer retention challenges, which could impact revenue stability and require strategic focus to mitigate competitive pressures.

Moderate Leverage

Moderate leverage is typical in telecom but poses risks if market conditions shift unfavorably, potentially impacting financial flexibility and investment capacity.

Public Sector Challenges

Difficulties in the public sector could hinder growth in this segment, necessitating strategic adjustments to capture opportunities and mitigate revenue impact.

Verizon Business Overview & Revenue Model

Company Description

Verizon Communications Inc., through its subsidiaries, offers communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide. Its Consumer segment provides postpaid and prepaid service plans; internet access on notebook computers and tablets; wireless equipment, including smartphones and other handsets; and wireless-enabled internet devices, such as tablets, and other wireless-enabled connected devices comprising smart watches. It also provides residential fixed connectivity solutions, such as internet, video, and voice services; and sells network access to mobile virtual network operators. As of December 31, 2021, it had approximately 115 million wireless retail connections, 7 million wireline broadband connections, and 4 million Fios video connections. The company's Business segment provides network connectivity products, including private networking, private cloud connectivity, virtual and software defined networking, and internet access services; and internet protocol-based voice and video services, unified communications and collaboration tools, and customer contact center solutions. This segment also offers a suite of management and data security services; domestic and global voice and data solutions, such as voice calling, messaging services, conferencing, contact center solutions, and private line and data access networks; customer premises equipment; installation, maintenance, and site services; and Internet of Things products and services. As of December 31, 2021, it had approximately 27 million wireless retail postpaid connections and 477 thousand wireline broadband connections. The company was formerly known as Bell Atlantic Corporation and changed its name to Verizon Communications Inc. in June 2000. Verizon Communications Inc. was incorporated in 1983 and is headquartered in New York, New York.

How the Company Makes Money

Verizon generates revenue primarily through its wireless and wireline segments. The wireless segment, which comprises the majority of the company’s revenue, includes sales from mobile voice and data plans, equipment sales, and accessory sales. The company also offers premium services, such as Verizon 5G Home and Fios internet, which contribute to its wireline revenue. In addition, Verizon earns income from its business solutions, including IoT services and managed services for enterprise customers. Key partnerships with technology providers and content creators enhance its service offerings and customer loyalty, while continuous investments in network infrastructure help to maintain its competitive edge. Furthermore, Verizon's advertising solutions and media partnerships provide additional revenue streams, leveraging its extensive customer data for targeted advertising.

Verizon Financial Statement Overview

Summary

Verizon's financial performance is strong, marked by robust profitability, efficient cash flow generation, and a stable balance sheet. The income statement reflects solid profit margins and revenue growth, while cash flow statements show impressive free cash flow generation. However, moderate leverage on the balance sheet needs monitoring.

Income Statement

Verizon's income statement reveals robust profitability with a consistent gross profit margin of approximately 59.3% TTM. The net profit margin remains strong at around 13.3% TTM, although it has slightly decreased from previous years, reflecting some pressure on net income growth. Revenue growth is modest but positive, indicating stable revenue trends in a competitive industry. The EBIT and EBITDA margins, at 21.5% and 35.6% TTM respectively, demonstrate efficient operational performance. Overall, Verizon's income statement reflects steady profitability and stable revenue generation.

Balance Sheet

Verizon's balance sheet shows a healthy equity base with a debt-to-equity ratio of 1.63 TTM, indicating moderate leverage for a telecom giant. The equity ratio stands at 27.2% TTM, reflecting a stable capital structure supported by a solid asset base. Return on equity (ROE) is commendable at 17.4% TTM, showcasing effective utilization of shareholder funds. While Verizon maintains a firm financial position, the reliance on debt financing could pose risks if market conditions shift unfavorably.

Cash Flow

Verizon's cash flow statement exhibits strong cash generation capabilities, with a notable operating cash flow to net income ratio of 2.04 TTM, indicating effective conversion of income into cash. The free cash flow to net income ratio at 1.53 TTM underscores robust free cash flow generation, crucial for sustaining dividends and investments. Free cash flow growth is impressive with a 46.9% increase TTM compared to the previous period. Overall, Verizon's cash flow statement reflects strong liquidity and efficient cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	137.00B	134.79B	133.97B	136.84B	133.61B	128.29B
Gross Profit	67.76B	62.80B	61.46B	60.60B	61.11B	60.37B
EBITDA	48.72B	47.52B	40.14B	48.95B	49.12B	44.96B
Net Income	18.19B	17.51B	11.61B	21.26B	22.07B	17.80B
Balance Sheet
Total Assets	383.29B	384.71B	380.25B	379.68B	366.60B	316.48B
Cash, Cash Equivalents and Short-Term Investments	3.44B	4.19B	2.06B	2.60B	2.92B	22.17B
Total Debt	169.89B	168.36B	174.94B	176.33B	177.93B	150.55B
Total Liabilities	278.92B	284.14B	286.46B	287.22B	283.40B	247.21B
Stockholders Equity	103.06B	99.24B	92.43B	91.14B	81.79B	67.84B
Cash Flow
Free Cash Flow	19.61B	18.92B	18.71B	10.40B	19.25B	21.45B
Operating Cash Flow	37.10B	36.91B	37.48B	37.14B	39.54B	41.77B
Investing Cash Flow	-16.75B	-18.67B	-23.43B	-28.66B	-67.15B	-23.51B
Financing Cash Flow	-20.31B	-17.10B	-14.66B	-8.53B	8.28B	1.32B

Verizon Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 43.18
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VZ, the sentiment is Neutral. The current price of 43.18 is below the 20-day moving average (MA) of 43.78, below the 50-day MA of 43.41, and above the 200-day MA of 41.73, indicating a neutral trend. The MACD of -0.07 indicates Positive momentum. The RSI at 44.02 is Neutral, neither overbought nor oversold. The STOCH value of 18.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VZ.

Verizon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VZ	83 Outperform	$182.06B	10.07	18.26%	6.28%	2.05%	61.39%
CMCSA	78 Outperform	116.71B	5.22	23.65%	4.05%	2.54%	60.53%
T	77 Outperform	202.50B	16.41	12.12%	3.92%	1.46%	0.88%
TMUS	73 Outperform	268.30B	22.59	19.99%	1.48%	6.27%	31.78%
AMX	68 Neutral	62.87B	22.54	11.57%	2.54%	-0.64%	56.92%
CHTR	68 Neutral	40.15B	7.17	32.48%	―	1.03%	17.05%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%

Verizon Corporate Events

Verizon Finalizes Private Exchange Offers for Notes

On June 23, 2025, Verizon announced the final results of its private exchange offers for 10 series of notes and related tender offers. The exchange offers, which expired on June 18, 2025, involved swapping outstanding notes for newly issued 5.401% Notes due 2037. Verizon plans to issue approximately $2.2 billion in new notes, meeting the Minimum Issue Requirement. The company will not receive cash proceeds from these offers, and certain non-covered notes were rejected due to conditions not being satisfied, impacting some stakeholders.

Verizon Announces Results of Private Exchange Offers

On June 20, 2025, Verizon announced the expiration and preliminary results of its private exchange offers for ten series of notes, alongside the expiration of related tender offers for certain investors. The exchange offers, which expired on June 18, 2025, involved swapping outstanding notes for new 5.401% notes due in 2037. Verizon expects the minimum issue requirement to be met, but will not receive cash proceeds from these offers. The issuance of new notes is subject to certain conditions, and they will not be registered under the Securities Act, limiting their sale in the U.S.

Verizon Announces Pricing for Debt Exchange Offers

On June 18, 2025, Verizon Communications Inc. announced the pricing terms for its private exchange offers and related tender offers for 10 series of outstanding notes. This strategic financial maneuver aims to exchange old notes for newly issued debt securities, potentially impacting Verizon’s financial structure and market positioning. The exchange offers were set to expire on the same day, with the settlement date expected to follow on June 25, 2025, indicating a swift execution of the plan.

Verizon Initiates Private Exchange Offers for Notes

On June 12, 2025, Verizon announced the initiation of private exchange offers for ten series of its outstanding notes, aiming to exchange them for newly issued debt securities. This strategic financial move is designed to optimize Verizon’s debt structure, potentially impacting its financial stability and market positioning. The exchange offers are targeted at qualified institutional buyers and non-U.S. qualified offerees, with the process set to conclude on June 18, 2025, unless extended.

Verizon Shareholders Meeting Approves Board and Compensation

At the 2025 Annual Meeting of Shareholders held on May 22, 2025, Verizon Communications Inc. announced the election of several board members and the approval of executive compensation. The meeting also ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for 2025. However, shareholder proposals on climate lobbying alignment, lead-sheathed cable reporting, and discrimination in advertising services were defeated, reflecting the company’s current strategic priorities and stakeholder interests.