Things Have Changed for Verizon: Fool by Numbers

On Jan. 28, Verizon Communications (NYSE: VZ  ) released earnings for the 2007 fiscal year, ended Dec. 31.

  • Verizon has 8.1% fewer landline customers today than a year ago, but 17.9% more high-speed data line subscribers and 11.3% more wireless accounts. The telecom times, they are a-changin'.
  • The company is still growing revenue at a respectable clip and widening its operating margins.
  • Small-time telecom operators have the Motley Fool CAPS crowd all tangled up in blue, but when AT&T (NYSE: T  ) and Verizon roll around, everybody's gonna jump for joy. Weigh in with your own ratings and comments right here.

(Figures in millions, except per-share data.)

Income Statement Highlights

FY 2007

FY 2006

Change

Sales

$93,469

$88,182

6.0%

Net Profit

$5,521

$6,197

(10.9%)

EPS

$1.90

$2.12

(10.0%)

Diluted Shares

2,902.0

2,938.0

(1.2%)

Get back to basics with the income statement.

Margin Checkup

FY 2007

FY 2006

Change*

Operating Margin

16.7%

15.2%

1.5

Net Margin

5.9%

7.0%

(1.1)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

FY 2007

FY 2006

Change

Cash + ST Invest.

$3,397

$5,653

(39.9%)

Accounts Rec.

$11,736

$10,891

7.8%

Inventory

$1,729

$1,514

14.2%

Liabilities

FY 2007

FY 2006

Change

Long-Term Debt

$28,203

$28,646

(1.5%)

The balance sheet reflects the company's health.

Cash Flow Highlights

FY 2007

FY 2006

Change

Cash From Ops.

$25,739

$24,106

6.8%

Capital Expenditures

$17,538

$17,101

2.6%

Free Cash Flow

$8,201

$7,005

17.1%

Free cash flow is a Fool's best friend.

Competitive Context

Market Cap (in $ billions)

Trailing P/E Ratio

CAPS Rating

AT&T

$216.7

18.5

****

Verizon

$108.1

19.7

****

Comcast (Nasdaq: CMCSA  )

$53.7

23.1

**

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