Verizon Faces Growing Price Pressures: Analyst

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Shares of

Verizon Communications

were falling in Thursday trading after an analyst flagged competitive concerns that could weigh on the stock.

MoffettNathanson analyst Craig Moffett cut his rating on Verizon stock (ticker: VZ) to Underperform from Market Perform in a note on Thursday. He also lowered its target price to $41 from $55. Moffett called Verizon the “biggest loser” of

AT&T
’s
promotional efforts, which he describes as “aggressive.”

“Verizon has done its best to avoid being dragged into

AT&T
’s
promotional abyss, but their efforts have been met with only limited success,” the analyst wrote. “They have seesawed between periods of promotionality and financial restraint, optimizing neither.”

A Verizon representative didn’t return a request seeking comment.

Verizon stock was down 2.8% to $44.06 in Thursday trading, while the S&P 500 index was flat.

The analyst also argued

T-Mobile

(TMUS) has been growing its competitive advantage in 5G while offering lower prices.

“In survey after survey,

T-Mobile

is pulling away, winning consistently not only for download and upload speeds, but for coverage and availability as well,” Moffett wrote. “Verizon’s customer base, self-selected for their ‘best network’ positioning, appears particularly vulnerable.”

Verizon also has price competition from traditional cable industry firms, like

Comcast
’s
Xfinity Mobile, according to Moffett. He also cut the

AT&T

target to $17 from $19.

“None of this is good news for AT&T and Verizon,” he added.

Write to Connor Smith at [email protected]