Head-To-Head Survey: Verizon Communications (VZ) vs. Its Peers

Verizon Communications (NYSE: VZ) is one of 45 public companies in the “Integrated Telecommunications Services” industry, but how does it contrast to its competitors? We will compare Verizon Communications to similar companies based on the strength of its valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Profitability

This table compares Verizon Communications and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Verizon Communications 12.80% 58.66% 6.13%
Verizon Communications Competitors 0.98% -0.78% 1.43%

Valuation and Earnings

This table compares Verizon Communications and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Verizon Communications $123.64 billion $43.95 billion 12.26
Verizon Communications Competitors $13.52 billion $4.52 billion 6.06

Verizon Communications has higher revenue and earnings than its competitors. Verizon Communications is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Verizon Communications pays an annual dividend of $2.36 per share and has a dividend yield of 4.9%. Verizon Communications pays out 60.5% of its earnings in the form of a dividend. As a group, “Integrated Telecommunications Services” companies pay a dividend yield of 5.0% and pay out 946.0% of their earnings in the form of a dividend. Verizon Communications has increased its dividend for 10 consecutive years.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Verizon Communications and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Verizon Communications 0 19 5 0 2.21
Verizon Communications Competitors 538 1549 1839 65 2.36

Verizon Communications currently has a consensus target price of $52.91, indicating a potential upside of 10.62%. As a group, “Integrated Telecommunications Services” companies have a potential upside of 48.49%. Given Verizon Communications’ competitors stronger consensus rating and higher possible upside, analysts plainly believe Verizon Communications has less favorable growth aspects than its competitors.

Volatility & Risk

Verizon Communications has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500. Comparatively, Verizon Communications’ competitors have a beta of 0.95, indicating that their average stock price is 5% less volatile than the S&P 500.

Institutional & Insider Ownership

62.1% of Verizon Communications shares are held by institutional investors. Comparatively, 58.2% of shares of all “Integrated Telecommunications Services” companies are held by institutional investors. 0.1% of Verizon Communications shares are held by company insiders. Comparatively, 4.5% of shares of all “Integrated Telecommunications Services” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Verizon Communications beats its competitors on 8 of the 15 factors compared.

About Verizon Communications

Verizon Communications Inc. is a holding company. The Company, through its subsidiaries, provides communications, information and entertainment products and services to consumers, businesses and governmental agencies. Its segments include Wireless and Wireline. The Wireless segment offers communications products and services, including wireless voice and data services and equipment sales, to consumer, business and government customers across the United States. The Wireline segment offers voice, data and video communications products and services, such as broadband video, data center and cloud services, security and managed network services, and local and long distance voice services. The Company has combined Yahoo! Inc.’s operating assets with its existing AOL Inc. business to create a new subsidiary, Oath Inc., owns a diverse house of more than 50 media and technology brands. The Oath portfolio includes HuffPost, Yahoo Sports, AOL.com, MAKERS, Tumblr, Yahoo Finance and Yahoo Mail.

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