VZ - Embedded Expectations Analysis - 2020 09 04
Verizon Communications Inc. (VZ:USA) currently trades below recent averages relative to UAFRS-based (Uniform) earnings with a 15.0x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about their wireless service revenue, postpaid phone adds, and SD-WAN productsSpecifically, management may have concerns about continued weakness in wireless service revenue, continued declines in postpaid phone additions, and the impact of their postponed quarterly tax payments on their cash flows. Furthermore, they may be overstating their customers' ability to transition to Mix & Match unlimited plans, their opportunities in H2 2020, and the momentum in their SD-WAN products. Additionally, management may lack confidence in their ability to maintain the success of Verizon Consumer Group, capitalize opportunities from the full market, and achieve expected revenue from the 5G mobile edge compute
Verizon Communications is a holding company. Through its subsidiaries, the company provides communications, information and entertainment products and services to consumers, businesses and governmental agencies. The company has two reportable segments, Verizon Consumer Group (Consumer) and Verizon Business Group (Business). The company's Consumer segment provides consumer-focused wireless and wireline communications services and products under the Verizon brand and through wholesale and other arrangements. The company's Business segment provides, among others, wireless and wireline communications services and products, video and data services, corporate networking solutions, security and managed network services.
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