Bank of America Securities analyst David Barden maintained a Hold rating on Verizon (VZ – Research Report) today and set a price target of $41.00.
David Barden has given his Hold rating due to a combination of factors including Verizon’s steady progress in its Consumer unit, tempered by a slight downturn in its Business segment. His analysis indicates that with Verizon’s new team and tools, there have been operating improvements that are expected to yield a modest increase in average revenue per user (ARPU) due to recent price hikes. However, these improvements are balanced against a slightly elevated churn rate and intensifying competition, particularly in the Business sector, leading to a more cautious outlook.
Furthermore, Barden notes that while Verizon is making positive strides in the Consumer segment, these changes will not yield immediate results. The company’s strategy is beginning to bear fruit with an anticipated growth in customer additions, but this is offset by a slight increase in customer turnover and aggressive moves by competitors like AT&T in the broadband market. Despite these challenges, Barden’s valuation suggests that Verizon’s stock price is fairly represented, leaving little room for significant upside, which justifies the Neutral, or Hold, recommendation.
Barden covers the Communication Services sector, focusing on stocks such as AT&T, Telus, and Verizon. According to TipRanks, Barden has an average return of 3.2% and a 55.88% success rate on recommended stocks.
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Verizon (VZ) Company Description:
Verizon Communications, Inc. provides wireless and wireline communications services and products through its two segments: Verizon Consumer Group and Verizon Business Group. The Verizon Business segment also offers video and data services, corporate networking solutions, security and managed network services, local and long distance voice services and network access to deliver various Internet of Things (IoT) services and products. The company was founded in 1983 and is headquartered in New York, NY.
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