VZ

Verizon Communications Inc

TMT


Presented:10/24/2018
Price:$57.42
Cap:$237.26B
Current Price:$43.74
Cap:$184.12B

Presented

Date10/24/2018
Price$57.42
Market Cap$237.26B
Ent Value$333.03B
P/E Ratio7.31x
Book Value$13.19
Div Yield2.97%
Shares O/S4,132.00M
Ave Daily Vol14,848,646
Short Int0.93%

Current

Price$43.74
Market Cap$184.12B
Verizon Communications, Inc. is a holding company, which engages in the provision wireless communications products and services. It operates through Wireless, and Wireline segments. The Wireless segment provides wireless voice and data services and equipment sales, which are provided to consumer, business, and government customers. The Wireline segment offers broadband video and data; corporate networking solutions; data center and cloud services; security and managed network services; and local and long distance voice services. The company was founded on June 30, 2000 and is headquartered in New York, NY.

Publicly traded companies mentioned herein: AT&T Inc (T), Intel Corp (INTC), QUALCOMM Inc (QCOM), Sprint Corp (S), T-Mobile US Inc (TMUS), Verizon Communications Inc (VZ)

Highlights

The presenter is long shares of Verizon Communications (VZ), and sees its differentiated 5G product providing a competitive, first mover advantage over the next 2 - 3 years. While VZ won’t see meaningful revenue from its 5G rollout over the next 1.5 years, it should be able to maintain its recent positive revenue inflection and lead the pack for 3 - 4 years while T-Mobile, AT&T, etc. try to catch up. Additionally, he doesn’t see a huge CAPEX increase as VZ is currently near its peak pace of spending, and it can only move so fast with fiber deployment. With good execution on 5G next year, the current 12x multiple on earnings could expand to 15x. At the Street’s forecasted 2018 EPS of $4.50, the implied target value is $67.50, or ~18% higher than current levels, with additional upside potential depending on the success of 5G.

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Idea Discussion

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