AT&T Inc. (T) vs Verizon Communications Inc. (VZ)

AT&T Inc. and Verizon Communications Inc. are both Telecom Services companies. Verizon Communications Inc. is the larger, with a market value of $197.0B against $174.2B — 1.1× the size. AT&T Inc. trades at the lower P/E: 8.4× against 12.3×. AT&T Inc. grew revenue faster over the last twelve months: 2.63% against 1.38%. AT&T Inc. has the higher net margin (16.8% vs 11.6%) and the lower return on invested capital (6.33% vs 6.64%). Both pay a dividend; Verizon Communications Inc. yields more (6.75% vs 6.67%). Across the 23 metrics below, AT&T Inc. leads on 16 and Verizon Communications Inc. on 7.

Valuation

Metric T VZ Telecom Services median
P/E 8.40 12.26 13.27
P/S 1.38 1.41 0.95
P/B 1.39 1.87 1.47
Price to free cash flow 9.99 9.73 8.72
EV/EBITDA 6.58 7.56 6.85
EV/Sales 2.38 2.59 1.87
Earnings yield 11.90% 8.16% 1.66%
Free cash flow yield 10.01% 10.27% 5.53%

Profitability

Metric T VZ Telecom Services median
Gross margin 59.72% 59.26% 51.26%
Operating margin 20.12% 20.54% 7.62%
Net margin 16.83% 11.64% 4.22%
Free cash flow margin 13.85% 14.51% 4.73%
Return on equity 17.28% 15.43% 5.80%
Return on assets 5.14% 4.08% 0.00%
Return on invested capital 6.33% 6.64% 3.41%

Growth

Metric T VZ Telecom Services median
Revenue growth (TTM) 2.63% 1.38% 3.31%
EPS growth (last fiscal year) 104.03% (1.93%) —
Revenue growth, 5-year CAGR (2.56%) 1.50% 1.50%
Net income growth, 5-year CAGR 0.00% (0.71%) 0.00%

Health

Metric T VZ Telecom Services median
Debt to equity 1.14 1.57 0.63
Current ratio 0.97 0.60 1.13
Net debt to EBITDA 2.62 2.92 1.86

Dividend

Metric T VZ Telecom Services median
Dividend yield 6.67% 6.75% 4.06%
Payout ratio 0.56 0.52 0.00

Size

Metric T VZ Telecom Services median
Market cap 174.19b 196.96b 3.06b

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