Verizon’s Market Moves: A Closer Look at Its Financial Performance

With a market cap of $184.6 billion, Verizon Communications Inc. (VZ) stands out as a major player in global communications, technology, and entertainment. The company divides its operations into two parts: the Verizon Consumer Group, which provides wireless and wireline services, and the Verizon Business Group, focusing on broadband, networking, and IoT solutions.

Valued at well above $10 billion, Verizon is categorized as a “large-cap” stock. It has earned a reputation for running the largest mobile network in the United States and leading advancements in 5G technology, distinguishing itself in the competitive telecommunications landscape.

However, the company has seen its stock price decrease nearly 3% from its 52-week high of $43.46. Over the past three months, Verizon’s shares have risen by 2.7%, but this increase falls short compared to the Communication Services Select Sector SPDR ETF Fund (XLC), which surged 16.1% in the same timeframe.

Looking at the bigger picture, VZ’s shares have gone up 16.9% since the start of the year, yet this is still less than XLC’s impressive 37% rise. Throughout the past year, Verizon’s stock increased by 14.2%, while XLC’s return was 42.4% during the same period.

Despite these figures, Verizon’s stock has maintained a bullish trend, trading above its 200-day moving average since last year and generally remaining above its 50-day moving average, despite a few swings.

On October 22, the company’s stock fell by 5% following disappointing Q3 revenue results. Verizon reported total revenue of $33.3 billion, just missing analysts’ expectations. Contributing to this decline was an 8.1% drop in wireless equipment sales to $5.3 billion and a sluggish smartphone upgrade cycle. Furthermore, the company faced unexpected special charges, including $1.7 billion for severance costs tied to layoffs, impacting earnings and stock prices. On a more positive note, on November 13, the stock saw a 1.8% increase after Frontier Communications’ shareholders approved Verizon’s $20 billion acquisition. This acquisition is expected to enhance Verizon’s fiber network capabilities, allowing for improved mobility and broadband services.

In contrast, rival AT&T Inc. (T) has outperformed VZ significantly, boasting a 41% growth year-to-date and a similar rise of 41.1% over the past 52 weeks.

Even with VZ’s recent struggles, analysts maintain moderate optimism regarding the stock’s future. The consensus rating stands at “Moderate Buy” from the 23 analysts observing it. Currently, the stock trades below the average price target of $46.21.

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