Verizon Communications Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Verizon Communications (NYSE:VZ) will unveil its latest earnings tomorrow, Tuesday, January 22, 2013. Verizon Communications provides communications services.

Verizon Communications Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 56 cents per share, a rise of 7.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 59 cents. Between one and three months ago, the average estimate was unchanged. It has since dropped over the last month. For the year, analysts are projecting net income of $2.42 per share, a rise of 12.6% from last year.

Past Earnings Performance: Last quarter, the company fell short of estimates by 0 cents, coming in at profit of 64 cents per share against a mean estimate of net income of 65 cents. The company fell in line with expectations in the second quarter.

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A Look Back: In the third quarter, profit rose 15.5% to $1.59 billion (56 cents a share) from $1.38 billion (49 cents a share) the year earlier, but fell short analyst expectations. Revenue rose 3.9% to $29.01 billion from $27.91 billion.

Here’s how Verizon Communications traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

VZ

Stock Price Performance: Between October 18, 2012 and January 15, 2013, the stock price fell $3.81 (-8.3%), from $45.78 to $41.97. The stock price saw one of its best stretches over the last year between September 14, 2012 and September 24, 2012, when shares rose for seven straight days, increasing 2.6% (+$1.15) over that span. It saw one of its worst periods between October 4, 2012 and October 16, 2012 when shares fell for nine straight days, dropping 6.7% (-$3.18) over that span.

Wall St. Revenue Expectations: On average, analysts predict $29.71 billion in revenue this quarter, a rise of 4.5% from the year-ago quarter. Analysts are forecasting total revenue of $115.47 billion for the year, a rise of 4.1% from last year’s revenue of $110.88 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 7.7% in the fourth quarter of the last fiscal year, 4.6% in the first quarter and 3.7% in the second quarter before increasing again in the third quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.96 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company regressed in this liquidity measure from 1.03 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 9.2% to $28.77 billion while assets rose 2% to $27.66 billion.

Analyst Ratings: There are mostly holds on the stock with 17 of 29 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)