Price to FCFE (P/FCFE)
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Verizon Communications Inc. pages available for free this week:
- Balance Sheet: Assets
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value (EV)
- Enterprise Value to FCFF (EV/FCFF)
- Dividend Discount Model (DDM)
- Current Ratio since 2005
- Total Asset Turnover since 2005
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Free Cash Flow to Equity (FCFE)
Verizon Communications Inc., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The financial data reveals several notable trends in cash flow activities over the five-year period ending in 2024. Operating cash flow, a critical indicator of a company's core business health, demonstrated a gradual decline from 41,768 million USD in 2020 to 36,912 million USD in 2024. Although there was a slight uptick in 2023 compared to 2022, the overall trend points to a decrease in the ability to generate cash through operations.
Free cash flow to equity (FCFE), which reflects the cash available to equity shareholders after capital expenditures and debt payments, showed considerable volatility. In 2020, FCFE was robust at 34,655 million USD but experienced a sharp and significant decline resulting in a negative value (-8,098 million USD) in 2021. This negative figure suggests substantial outflows or reduced cash available to equity holders that year. Following this downturn, FCFE rebounded to positive territory in the subsequent years, reaching 14,383 million USD in 2022, then dipping slightly to 10,677 million USD in 2023 before rising again to 13,887 million USD in 2024.
- Operating Cash Flow
- Displayed a downward trend overall, decreasing by approximately 12% over the five years, indicating potential pressures on operational cash generation.
- Free Cash Flow to Equity (FCFE)
- Exhibited significant fluctuations, including a negative outlier in 2021, which may highlight extraordinary expenses, investments, or financing activities impacting equity cash availability during that period.
- Year-to-Year Variations
- While operating cash flow remained relatively stable, free cash flow to equity was more sensitive to changes, reflecting dynamic capital and financing decisions.
Overall, the data suggests a generally consistent operating cash flow performance with some erosion over time, while FCFE was subject to greater variability, likely due to capital structure adjustments or investment activities. Stakeholders should consider these patterns when evaluating liquidity, financial flexibility, and potential for shareholder returns.
Price to FCFE Ratio, Current
Verizon Communications Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | |
| FCFE per share | |
| Current share price (P) | |
| Valuation Ratio | |
| P/FCFE | |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| AT&T Inc. | |
| T-Mobile US Inc. | |
| P/FCFE, Sector | |
| Telecommunication Services | |
| P/FCFE, Industry | |
| Communication Services | |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Verizon Communications Inc., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | ||||||
| FCFE per share3 | ||||||
| Share price1, 4 | ||||||
| Valuation Ratio | ||||||
| P/FCFE5 | ||||||
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| AT&T Inc. | ||||||
| T-Mobile US Inc. | ||||||
| P/FCFE, Sector | ||||||
| Telecommunication Services | ||||||
| P/FCFE, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= ÷ =
4 Closing price as at the filing date of Verizon Communications Inc. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= ÷ =
6 Click competitor name to see calculations.
- Share Price
- The share price showed a declining trend from 2020 to 2022, dropping from 56.5 US$ to 40.01 US$. It then stabilized with slight fluctuations, reaching 40.53 US$ by the end of 2024. This decline followed by stabilization suggests initial market pressures or company challenges, with some recovery or market adjustment in the later periods.
- FCFE per Share (Free Cash Flow to Equity)
- The FCFE per share experienced significant volatility. Starting at 8.37 US$ in 2020, it sharply declined to -1.93 US$ in 2021, indicating negative free cash flow generation to equity holders in that year. This was followed by a recovery to positive values in subsequent years, reaching 3.3 US$ by 2024. This pattern reflects a period of cash flow stress or high capital expenditure in 2021, with gradual improvement thereafter.
- P/FCFE Ratio (Price to Free Cash Flow to Equity)
- The P/FCFE ratio is absent for 2021, likely due to the FCFE being negative that year, making the ratio not meaningful. For other years, the ratio increased from 6.75 in 2020 to a peak of 15.64 in 2023 before declining to 12.29 in 2024. The rising ratio during the recovery phase in FCFE suggests that the market valuation was relatively high compared to free cash flow, possibly reflecting optimistic market expectations or delayed market adjustment to improving cash flows.