VZ - Embedded Expectations Analysis - 2020 11 24
Verizon Communications Inc. (VZ:USA) currently trades below recent averages relative to UAFRS-based (Uniform) earnings with a 14.9x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about revenue declines, EPS growth, and the wireless technology marketSpecifically, management may lack confidence in their ability to mitigate revenue declines, sustain EPS growth, and achieve a net unsecured debt to adjusted EBITDA ratio of 1.75x-2.0x. Moreover, they may lack confidence in their ability to improve profitability across all units and their ability to continue investing efficiently in wireless technology. Furthermore, they may be concerned about the ongoing legacy wireline declines and their Mix & Match product. Finally, management may lack confidence in their ability to maintain high customer retention, and may be exaggerating the potential of their newly released CP
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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