Verizon Communications (VZ) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3-min read

Verizon Communications (VZ) closed the most recent trading day at $55.36, moving +0.11% from the previous trading session. This change lagged the S&P 500's 2.38% gain on the day. Elsewhere, the Dow gained 1.95%, while the tech-heavy Nasdaq added 3.01%.

Coming into today, shares of the largest U.S. cellphone carrier had lost 0.13% in the past month. In that same time, the Computer and Technology sector lost 1.35%, while the S&P 500 lost 0.91%.

Investors will be hoping for strength from VZ as it approaches its next earnings release. The company is expected to report EPS of $1.28, up 1.59% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $32.56 billion, up 3% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.06 per share and revenue of $133.18 billion, which would represent changes of +3.27% and +3.81%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for VZ. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.38% higher. VZ currently has a Zacks Rank of #3 (Hold).

Digging into valuation, VZ currently has a Forward P/E ratio of 10.93. This valuation marks a discount compared to its industry's average Forward P/E of 33.47.

It is also worth noting that VZ currently has a PEG ratio of 2.92. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. VZ's industry had an average PEG ratio of 3.26 as of yesterday's close.

The Wireless National industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 168, which puts it in the bottom 35% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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