QS Research · Michael Burry's Scion Capital analyst template · 2006
VERIZON COMMUNICATIONS INC (VZ)
As of 2026-11-08 · 12/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case +1% · downside -17% · upside +16%
The market is pricing Verizon as a no-growth, over-levered telco facing a certain SpaceX fourth entrant, while current numbers show stable EBITDA and a 6.3% dividend yield. At today's 7.1x TTM EV/EBITDA on TTM EBITDA of $48.59B, EV is $345.0B; less $153.66B net debt gives $191.3B equity, or $46.2/share (+1%). A 10% EBITDA stress at the same 7.1x gives $37.8/share (-17%), while 8% EBITDA growth (Q3 2026 Adjusted EBITDA +8.0%) gives $52.8/share (+16%). The third consecutive guidance raise, ~4% Q4 service-revenue guide, AI/AWS contract and buyback are real catalysts, but they do not yet clear the +30% base-case hurdle. I would watch, not own, until the Q4 2026 service-revenue inflection and deleveraging show up in reported numbers.
Key numbers
- Share price: $45.69
- Market cap: $189.37B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $139.39B
- EV / EBITDA (TTM): 7.1x
- P/E (TTM): 11.5x
The 15 boxes
- ✓ 1. Long-form business notes
Verizon reports two segments: Consumer, with FY2025 revenue of $106.8B, about 77% of consolidated revenue, and Business, with $29.1B, about 21%. It sells wireless postpaid and prepaid service, FWA and fiber broadband, equipment and related services through company stores, agents, retailers and business resellers; at December 31, 2025 Consumer had about 116M wireless retail connections and about 11M broadband connections, while Business had about 31M postpaid wireless connections and about 3M broadband connections. Since the FY2020 10-K, Consumer revenue rose from $88.5B, about 69% of consolidated revenue, while Business revenue was $31.0B, about 24%, and total revenue was $128.29B in FY2020 versus $138.19B in FY2025, with net income of $17.80B versus $17.17B. The latest 10-K also records the post-FY2025 Frontier and Starry acquisitions and a Q4 2025 plan to cut more than 13,000 positions.
- ✓ 2. Competitive advantage
Verizon has a licence-and-network-scale moat on paper, but the sources show no durable pricing advantage: FY2025 revenue was $138.19B versus $128.29B in FY2020, while operating income was only $29.26B versus $28.80B and net income $17.17B versus $17.80B. The 10-K calls the industry highly competitive, with aggressive pricing and promotions specifically targeting Verizon customers, and lists AT&T, T-Mobile, cable resellers and others as competitors. Licences, brand and network quality are cited, but no source quantifies spectrum depth, churn, market share, ROIC or a Verizon network superiority.
- ✓ 3. 10-Q takeaways
Q3 2026 was a service-revenue-led quarter: consolidated revenue $34,313M (+1.5% YoY) with mobility and broadband service revenue ~$23.5B (+2.9%) offsetting a 9.0% drop in equipment revenue, and Consolidated Adjusted EBITDA of $13,802M (+8.0%) at a 40.2% margin. Reported Q3 2026 net income was $5,320M versus $5,056M; the nine-month figure fell to $14,415M from $15,160M only because SG&A absorbed a $740M loss on the Verizon Contributed Business held-for-sale, $397M severance and acquisition/integration charges. Management raised FY2026 guidance for the third consecutive quarter (postpaid phone net adds 1.1-1.2M, Adjusted EPS $5.04-$5.06, FCF approaching +12%). The 10-Q states no material changes to risk factors since the FY2025 10-K.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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