Verizon Communications Inc
🇺🇸 VZ · NYSE/NASDAQ · US92343V1044
Telecom
USD 49.40 price at analysis
Scores
Key Metrics
Powered by EODHDP/E (TTM)
12.2
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Calculation: 49.40 ÷ 4.06 = 12.2
TTM period through: 2025-12-31
Forward P/E (estimated): 10.0
Based on analyst estimates
Reference: Provider P/E (Trailing): 12.2
Yield (Fwd)
5.73%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Trailing Yield (TTM): 5.54%
Net Debt/EBITDA (TTM)
3.8x
Latest quarter: 19.4x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
TTM through: 2025-12-31
Latest quarter (2025-12-31): 19.4x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
Payout (Fwd)
69.7%
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Payout (TTM): 66.8%
Cash Flow Payout (TTM): 30.9%
FCF Coverage (TTM): 1.75x
ROE
17.1%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
7.8x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
Summary
Verizon is a dominant telecommunications provider operating in a stable oligopoly, delivering essential infrastructure and highly predictable cash flows. Trading at an attractive P/E of 12.2 with a secure 5.5% yield (consuming just 31% of cash flow), it is worth considering for new positions at current levels. The company's massive free cash flow generation easily supports the dividend and debt obligations while management executes its long-term growth strategy.
Sector Context
Verizon is a dominant U.S. telecommunications provider, supplying essential wireless and broadband network infrastructure to consumers and businesses. The telecom sector is highly capital intensive, making higher debt levels like 3.8x Net Debt/EBITDA normal, while the oligopolistic nature of the industry ensures highly predictable, utility-like subscription cash flows.
Temporary Opportunity Identified
Historical earnings compression and capital expenditure cycles have temporarily depressed the stock's historical valuation multiples, though cash flow generation remains exceptionally robust.
📊 Strategy Analysis
- • Trading at an attractive P/E of 12.2, positioning it well within the target 8-15x valuation sweet spot for quality dividend stocks.
- • Excellent dividend sustainability with a 5.5% yield that consumes only 31% of cash flow, providing a massive safety buffer (1.75x FCF coverage).
- • Operates in a highly protected US telecom oligopoly, ensuring stable, recurring subscription revenues characteristic of essential services.
- • Recent bullish 2026 growth outlook and ongoing cost-cutting initiatives provide clear catalysts for reversing recent earnings stagnation.
⚠ What to Watch
- • Net Debt/EBITDA stands at 3.8x, exceeding the conservative 3.0x threshold, though this leverage is typical for capital-intensive telecom infrastructure.
- • Historical earnings show a 5-year CAGR decline of 5.3%, making the successful execution of current turnaround initiatives critical.
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Dividend Sustainability (FCF vs Dividends Paid)
Free cash flowFree Cash Flow
Cash left after the company pays for running the business and maintaining it. Often used to fund dividends, pay debt, or buy back shares. (FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., blue) should cover dividends paidDividends Paid
Cash the company paid out to shareholders. It’s not guaranteed and can change over time. (green). If dividends consistently exceed FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., the dividend may be at risk.
Analysis date: 2026-04-05
Disclaimer: This information is for educational purposes only. Not financial advice.