) stock to Outperform from Perform, citing its low valuation. He also established a $50 price target for the stock.
“The price is right after years of underperformance,” Horan wrote. “We previously downgraded in 2/25/21, because the company overpaid for spectrum and [was] late to mid-band 5G builds, which led to customer defections, weaker balance sheet, and substantial capex investment. These factors are now reversing.”
Verizon stock is up 0.4% to $38.90 in Thursday trading.
In July, the company lowered its full-year earnings-per-share guidance to a range from $5.10 to $5.25, down from its prior forecast range from $5.40 to $5.55. Its stock is down about 25% this year.
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The analyst cited how Verizon is trading at just 7.5 times his 2023 earnings-per-share estimate and has an attractive 6.6% dividend yield. Horan wrote that the company can boost subscriber numbers with its new plans—including its inexpensive Welcome Unlimited plan and higher-end
) in improving the quality of its 5G coverage and performance.
The “successful bundling of its burgeoning fixed wireless-access service, [is] an unequivocal hit where we have a variant positive view versus detractors,” he wrote, mentioning Verizon’s progress with its internet access service for homes and businesses.
Buy Verizon Stock for a Turnaround and Its Big Dividend, Says Analyst
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The Verizon logo is seen at a Verizon Wireless store in San Francisco.
Justin Sullivan/Getty Images
Oppenheimer believes Verizon Communications stock is now too cheap to ignore.
On Wednesday, analyst Timothy Horan raised his rating on
Verizon
(ticker:
VZ
) stock to Outperform from Perform, citing its low valuation. He also established a $50 price target for the stock.
“The price is right after years of underperformance,” Horan wrote. “We previously downgraded in 2/25/21, because the company overpaid for spectrum and [was] late to mid-band 5G builds, which led to customer defections, weaker balance sheet, and substantial capex investment. These factors are now reversing.”
Verizon stock is up 0.4% to $38.90 in Thursday trading.
In July, the company lowered its full-year earnings-per-share guidance to a range from $5.10 to $5.25, down from its prior forecast range from $5.40 to $5.55. Its stock is down about 25% this year.
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The Barron’s Daily
A morning briefing on what you need to know in the day ahead, including exclusive commentary from Barron’s and MarketWatch writers.
The analyst cited how Verizon is trading at just 7.5 times his 2023 earnings-per-share estimate and has an attractive 6.6% dividend yield. Horan wrote that the company can boost subscriber numbers with its new plans—including its inexpensive Welcome Unlimited plan and higher-end
Apple
One Unlimited plan. Horan is also optimistic Verizon can catch up to T-Mobile US (
TMUS
) in improving the quality of its 5G coverage and performance.
The “successful bundling of its burgeoning fixed wireless-access service, [is] an unequivocal hit where we have a variant positive view versus detractors,” he wrote, mentioning Verizon’s progress with its internet access service for homes and businesses.
Write to Tae Kim at [email protected]
Source: https://www.barrons.com/articles/verizon-stock-upgrade-analyst-wall-street-51665071871?siteid=yhoof2&yptr=yahoo