Verizon is ranked among the world's most valuable corporations. This telecommunication’s rapid growth is attributed to its spontaneous client growth, acquisitions, and investments in 5G and cloud computing technologies. So, what is Verizon’s net worth in 2023? Keep reading to learn more.
Verizon, a top US telecommunications provider, has invested heavily in its 5G network, reaching over 200 million Americans. The article has seen a rapid increase in fixed wireless and Fios Internet subscribers. This article examines Verizon's net worth, sales, profits, and growth forecasts for 2023.
Verizon Net worth 2023: Verizon's Valuation Breakdown
When it comes to market capitalization, Verizon is currently valued at over $200 billion. However, considering its hefty cash reserves and substantial debts, the total enterprise valuation escalates to around $300 billion. This valuation firmly cements Verizon's position as one of the world's premier telecom conglomerates.
As of May 2022, Verizon's market capitalization stood at a staggering $205.4 billion.
Financial Performance in 2021
- Operating Revenues: In the fiscal year of 2021, Verizon reported impressive total operating revenues of $133.6 billion, marking a 4% increase from the previous year.
- Net Income: The company's net income for 2021 amounted to $22.8 billion, which saw a rise from $18.3 billion in 2020.
Financial Position as of December 2021
- Cash Reserves: At the end of 2021, Verizon boasted cash and cash equivalents of about $22.1 billion.
- Long-term Debt: The company has also taken on over $159 billion in long-term debt, primarily for investments in its cutting-edge 5G network infrastructure.
Primary Revenue Streams
Verizon's wireless business is a significant revenue generator, contributing to over 70% of its total revenues. This encompasses monthly subscriber fees and data usage.
Factoring in its debt and cash reserves, Verizon's enterprise value is currently estimated to hover around $300 billion.
In 2022, Verizon achieved the #17 spot on the Fortune 500 list, advancing from #19 in the preceding year.
Fast forward to August 24, 2023, and Verizon's market capitalization is approximately $139.57 billion. Within the timeframe ending June 30, 2023, the company's net income was reported at $21.034 billion, reflecting a 1.13% YoY growth. In the first quarter of 2023 alone, Verizon witnessed a total wireless service revenue growth of between 2.5% to 4.5%.
Verizon Communication Background
Verizon Communications, a global telecommunications company, was established in 2000 after Bell Atlantic Corp. and GTE Corp. were combined from the Bell System breakdown. It operates in the telematics, media, and wireless industries in New York City. With a global presence, Verizon is expected to earn $133.6 billion in sales in 2021.
Verizon has undergone numerous mergers, acquisitions, divestitures, and innovations, including AOL and Yahoo acquisitions, creating Verizon Media, achieving net energy gain in nuclear fusion experiments, and reaching 200 million people with its 5G Ultra-Wideband network. The company aims to deliver the digital world's promise to millions of consumers daily.
What is Verizon’s Net worth Right Now?
Verizon's projected net worth is $250 billion, ranking it among the most valuable corporations globally. As of June 26, 2023, its market value is $151.81 billion. The company's net worth has increased significantly due to its excellent performance in the first quarter of 2023, with a net income of $5.0 billion, a 6.5% increase from 2022. Verizon's growth in broadband subscribers in the first quarter of 2023 demonstrates its ability to expand and innovate in the competitive market.
Verizon's operating revenue reached $136.8 billion in 2022, a 2.4% annual increase. However, analysts predict lower adjusted profits per share and cellular service revenue growth in 2023 due to competitive pressure and high expenses in the C-Band spectrum.
Verizon’s Growth Prospects for 2023
Verizon's wireless service revenue growth is expected to increase by 2.5% to 4.5% in 2023, despite the 8.6% growth forecast. Competitors AT&T and T-Mobile have marketed cheaper plans or superior 5G networks. Inflation, interest rates, and rising prices pose challenges for Verizon. However, the company's broadband division attracted 437,000 users in Q1 2023, and its 200 million+ users 5G network is promising. Verizon's growth depends on maintaining and acquiring customers, utilizing internet and 5G capabilities, and controlling spending and cash flow.
Verizon Market Map
The Verizon Market Map graphically displays the company's telecoms position, markets, offerings, rivals, advantages, disadvantages, chances, and threats. It helps determine the size, expansion potential, client preferences, and competitive advantages.
Verizon Communications Financial Statement
Verizon Communications Inc. reported $133.5 billion in sales, $30.8 billion in operating income, and $21.1 billion in net income in 2021. Earnings per share increased to $5.08 from $4.65 in 2020. The company generated $43.6 billion in cash from operations and $23.6 billion in free cash flow. Capital improvements and wireless spectrum licenses contributed to $18.2 billion in capital expenditures.
Verizon Communication Investor Sentiments
Verizon reported strong profitability and sales growth in Q1 2023 due to its 5G network expansion and loyal client base. The company declared a quarterly dividend and held Investor Day 2022, revealing long-term goals. Verizon's stock increased by 9%, outpacing the S&P 500 index.
Verizon Communication Corporate Directors
The 14-member board of directors oversees Verizon Communications' executive staff, with members from diverse fields like technology, finance, healthcare, journalism, and public service. Hans Vestberg, CEO since 2018, and Clarence Otis Jr. are executive directors. Other notable corporate executives include Mark Bertolini, Carol Tomé, and Daniel Schulman. The board significantly influences Verizon Communications' strategy, innovation, and performance.
Verizon Stock Against Markets
Verizon stock underperformed in the past year, losing nearly 25% of its value compared to the S&P 500 index. Despite challenges in the fast-paced telecom sector, there are potential expansion opportunities. Investors should weigh the benefits and risks of purchasing Verizon stock based on their objectives and interests. Some of the reasons for Verizon's weak performance are:
- T-Mobile dominates the cellular sector, gaining market share through cost reduction and service enhancement.
- Verizon faces limited financial flexibility and dividend growth due to high debt from 5G investments and spectrum licenses. The company's cellular business and media divisions struggle due to the pandemic and shifting customer preferences.
However, Verizon also has some strengths that could help it improve its performance in the future, such as:
- With a large client base, the company offers a high dividend yield of 7.3%.
- Verizon's 5G market offers comprehensive coverage and fast speeds, potentially increasing demand and revenue through strategic alliances with Disney, Microsoft, and Amazon.
How to Buy Verizon Stock
Verizon offers a Direct shares Purchase and Dividend Reinvestment Plan for an affordable investment in stock. With a minimum initial commitment of $250 and monthly withdrawals of $50, dividends can be automatically reinvested or sent in cash.
Diversify Verizon stock to capitalize on stability and development. Consider risks and expenses, and consult a financial professional before investing, considering market volatility, fees, taxes, and regulatory changes.
Complementary Tools for Verizon Stock Analysis
Investors can evaluate VZ's stock performance using tools like Stock Analysis, Yahoo Finance, and The Wall Street Journal. These resources provide financial data, analyst ratings, sales estimates, earnings projections, and growth estimates, enabling a comprehensive understanding of the company's potential.
Factors that Boost Valuation of Verizon Communication
Some of the factors that may boost the valuation of Verizon Communication are:
- Strong financial performance: Verizon Communication's net income and diluted EPS for the 12 months ended March 30, 2023, were 21.59 billion USD, with 10.89 billion USD of levered free cash flow and 38.61 billion USD of operational cash flow.
- Attractive dividend yield: Verizon Communications pays a quarterly dividend of 0.652 USD per share, exceeding the industry average yield of 4.80%. The company has increased its dividend for 15 years.
- Growth opportunities: Verizon Communications invests in emerging sectors like IoT, digital media, fiber optic infrastructure, and 5G networks to strengthen competitiveness and generate income. By 2023, 5G network accessibility could increase client base and ARPU revenue.
- Stable customer loyalty: Verizon Communication's low churn and excellent retention rates demonstrate its devoted clientele, with a 0.77% postpaid phone churn rate in Q1, more down than AT&T and T-Mobile.
Verizon has invested in 5G technology and expanded its income sources by partnering with content producers like Yahoo, AOL, and Disney. This has led to a net worth of $250 billion by 2023, with predicted future valuation growth and continued dominance in the telecom sector.