Morningstar

Verizon Impresses in a Tough Wireless Environment

It remains the best-positioned wireless carrier in the industry and shares are currently modestly undervalued, writes Morningstar’s Mike Hodel.

Securities In This Article
AT&T Inc
(T)
Verizon Communications Inc
(VZ)
T-Mobile US Inc
(TMUS)
International Business Machines Corp
(IBM)

We remain impressed by

The wireless competitive environment remains challenging, with

Growth in the fixed-line business was again modestly disappointing. Verizon added only 42,000 television customers during the quarter, down sharply versus a year ago despite the introduction of, and reportedly strong demand for, its Custom TV packages, which offer a stripped-down number of channels at a lower price point. The firm also added only 2,000 Internet access customers during the quarter, an indication that it continues to lose consumer market share overall. The enterprise business remains weak as currency effects and competitive pressure pulled revenue down 4.9%. Fixed-line margins were solid.

Morningstar Premium Members gain exclusive access to our full Verizon Report, including fair value estimates, consider buying/selling prices, bull and bear breakdowns, and risk analyses. Not a Premium Member? Get this and other reports immediately when you try Morningstar Premium free for 14 days.

More in Stocks

Consumer Defensives: Despite Angst, Thirsty Investors Have Names to Pursue

Estee Lauder, Kraft Heinz, and Dollar General are our top consumer defensive stocks.
Erin Lash, CFA

Industrials: Many Stocks Overvalued After Q3 Outperformance

Our top stocks in this sector are Chart Industries, Wesco, and CNH Industrial.
Brian Bernard, CFA, CPA

Basic Materials: Despite Index Rise, We See Multiple Long-Term Opportunities

In this sector, our favored stocks are Albemarle, Dow, and FMC.
Andrew Bischof, CFA and Travis Miller

About the Author

Michael Hodel, CFA

Sector Director
More from Author

Michael Hodel, CFA, is a sector director, AM Communication Services, for Morningstar*. He covers U.S. telecom service providers and related firms, including AT&T, Verizon, and Comcast. His team covers media companies, global telecom service providers, and owners of telecom infrastructure, such as wireless towers and data centers. The team’s research focuses on the role that evolving networking technologies, consumer habits, and industry structures play in shaping the competitive advantages and disadvantages facing firms under coverage.

Hodel joined Morningstar in 1998, initially serving within the equity data group, responsible for collecting financial information on thousands of firms. Prior to his current position, he spent two years as a portfolio manager for Morningstar Investment Management, LLC. Previously, he served as a technology strategist responsible for telecom research, chair of Morningstar’s Economic Moat Committee, and a senior member of Morningstar’s corporate credit ratings initiative.

Hodel holds a bachelor’s degree in finance, with highest honors, from the University of Illinois at Urbana-Champaign. He also holds a master’s degree in business administration from the University of Chicago Booth School of Business. He also holds the Chartered Financial Analyst® designation.

* Morningstar Research Services LLC (“Morningstar”) is a wholly owned subsidiary of Morningstar, Inc

Sponsor Center