VZ
Verizon Communications Inc.
$46.99
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 20.7% below fair value
You pay
$46.99
Bear
$47.37
Fair
$59.22
Bull
$71.07
Bear
$47.37
+0.8%
$4.25 × 12x P/E
Fair
$59.22
+26.0%
$4.25 × 15x P/E
Bull
$71.07
+51.2%
$4.25 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
11.0x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $50.69 from 61 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $59.22 per share.
Warnings
Dividend-based valuation: $45.67 (below our primary estimate by 28%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $50.69 (from 61 analysts). Our estimate is 26% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples