Verizon’s scale in the telecom industry
In this part of the series, we’ll look at Verizon’s (VZ) value proposition among select telecom players. As of January 22, 2016, Verizon was the third-largest global telecom company by market capitalization. It followed AT&T (T) in this metric. The largest global telecom player in the metric as of January 22 was China Mobile (CHL) as of January 22.
Verizon’s dividend yield
Now let’s take a look at Verizon’s dividend yield and some of the global players. Verizon’s forward annual dividend metric is ~4.8% as of January 22. It’s marginally lower than ~5.5% for AT&T and much smaller than ~8.7% for Telefonica as of the same day.
Verizon’s earnings multiples
Now let’s look at Verizon’s and some select telecom players’ earnings multiples. Verizon and AT&T had forward PE (price-to-earnings) multiples of ~11.6x and ~12.5x, respectively, on January 22, 2016.
In the international telecom space, the forward earnings metrics for Deutsche Telekom, Orange (ORAN), and America Movil were ~18.9x, ~14.4x, and ~10.2x, respectively, as of the same date.
You may consider investing in the SPDR Dow Jones Industrial Average ETF (DIA) to take a diversified exposure to Verizon. Verizon made up ~1.8% of DIA as of December 31, 2015. Verizon was the only telecom player in this ETF.