MeritValue

VERIZON COMMUNICATIONS INC

VZdata completeness 88%19 fiscal years on file
The thesis, from the filings

VERIZON COMMUNICATIONS INC earns about 19% on invested capital, with a roughly flat share count. The applicable estimate puts fair value near $42.88 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$133.6B1$136.8B2$134B3$134.8B3$138.2B3
Net income$22.1B4$21.3B5$11.6B6$17.5B6$17.2B6
Operating cash flow$39.5B7$37.1B8$37.5B9$36.9B9$37.1B9
Capital expenditure—————
Free cash flow (derived)—————
Total debt$7.44B10$10.1B11$13B12$45.3B13$37.7B13
Cash & equivalents$2.92B14$2.61B15$2.07B16$4.19B17$19B17
Diluted shares4.15B4.20B4.21B4.22B4.23B

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$249.92
your share of equity
Profit it earned you last year
$40.59
Free cash flow it threw off
—
Debt you’d be carrying
$89.05

10 shares is a claim on $249.92 of net worth that earned you $40.59 last year, against $89.05 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
19% avg · 5y
FY21 29%FY22 25%FY23 15%FY24 13%FY25 14%

It earned an average 19% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+2% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has risen 406% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
Earnings Power Value
$42.88
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$17.5B
  • growthAssumed0.0%
Graham Number
$47.78
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000732712-24-000010 (Revenues)
  2. 10-K · period ending 2022-12-31 · accession 0000732712-25-000006 (Revenues)
  3. 10-K · period ending 2023-12-31 · accession 0000732712-26-000007 (Revenues)
  4. 10-K · period ending 2021-12-31 · accession 0000732712-24-000010 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000732712-25-000006 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000732712-26-000007 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000732712-24-000010 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000732712-25-000006 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000732712-26-000007 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000732712-23-000012 (LongTermDebtCurrent)
  11. 10-K · period ending 2022-12-31 · accession 0000732712-24-000010 (LongTermDebtCurrent)
  12. 10-K · period ending 2023-12-31 · accession 0000732712-25-000006 (LongTermDebtCurrent)
  13. 10-K · period ending 2024-12-31 · accession 0000732712-26-000007 (LongTermDebtCurrent)
  14. 10-K · period ending 2021-12-31 · accession 0000732712-23-000012 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2022-12-31 · accession 0000732712-24-000010 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2023-12-31 · accession 0000732712-25-000006 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2024-12-31 · accession 0000732712-26-000007 (CashAndCashEquivalentsAtCarryingValue)