Verizon Communications Inc. (NYSE: VZ) stock fell over 0.9% on 22nd April, 2021 (as of 09:55:00 UTC-4 · USD ; Source: Google finance) after the company posted lower than expected results for the first quarter of FY 21.
In 2018, VZ had announced its goal to achieve $10 billion in cumulative cash savings by the end of 2021. At the end of first-quarter 2021, the company already achieved its goal, ahead of its target. The company has ended first-quarter 2021 with free cash flow of $5.2 billion, which represents an increase from $3.6 billion in first-quarter 2020.
Meanwhile, in first-quarter 2021, VZ had made payments of approximately $45 billion to the FCC for spectrum won at the recently completed C-Band auction. To finance this purchase, the company had raised $12 billion in fourth-quarter 2020, and more than $31 billion in March 2021. As part of its $25 billion U.S. financing, VZ had worked with nine firms that are either minority-owned, women-owned, or veteran or disabled veteran-owned, adding to its long history of partnering with diverse firms on capital market transactions.
For 2021, Verizon expects the service and other revenue to post growth of at least 2 percent, including total wireless service revenue growth of at least 3 percent, adjusted EPS (non-GAAP) to be in the range of $5.00 to $5.15 and adjusted effective income tax rate (non-GAAP) to be in the range of 23 percent to 25 percent. 2021 capital spending is expected to be in the range of $17.5 billion to $18.5 billion, including the further expansion of 5G mmWave in new and existing markets, the densification of the 4G LTE wireless network to manage future traffic demands and the continued deployment of the company’s fiber infrastructure. The expenditures related to the deployment of the company’s C-Band 5G network will be in addition to this amount, and are projected to be approximately $10 billion over three years, with $2 billion to $3 billion expected in 2021. The company projects its net unsecured debt to adjusted EBITDA ratio (non-GAAP) to be approximately 2.8 times by the end of 2021.