Key Stats for Verizon Stock
- Price change for Verizon stock: -9%
- $VZ Stock Price as of Oct. 9: $42
- 52-Week High: $52
- $VZ Stock Price Target: $51
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What Happened?
Verizon (VZ) fell 8.75% on Friday, the stock’s worst day since July 2002. The drop followed SpaceX’s announcement of a deal to buy a nationwide spectrum portfolio.
SpaceX wants to expand its Starlink internet service into mobile, and the spectrum comes from Grain Management.
SpaceX described it as up to 14 megahertz of paired spectrum in the 800 MHz band.
Other telecom stocks fell harder. T-Mobile dropped 13.27%, its worst day since 2013. AT&T fell 9.81%, its worst day since 2000.
SpaceX stock rose about 1%.
FCC Chair Brendan Carr said the competition is good news for consumers.
He said the FCC expects to bring over $100 billion of spectrum to market in the next two years. He added that the FCC isn’t responsible for picking winners and losers.
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What the Market Is Telling Us About Verizon Stock
Investors reacted fast. Verizon stock took a big hit as a new, well-funded rival got more serious.
Some analysts see it differently. Evercore ISI said SpaceX now has the outline of a real network. JPMorgan said the deal makes Starlink Mobile’s long-term opportunity more credible.
But JPMorgan also saw limited near-term risk for U.S. wireless companies. Building a competitive network takes time, infrastructure and capital.
Verizon’s CEO spoke about satellite competition on the Q2 call in July, before this deal. Dan Schulman said satellite complements Verizon’s service.
He said satellite cannot effectively compete in urban and suburban areas, where 95% to 98% of Verizon’s revenue comes from.
He also said no one can access Verizon’s MVNOs. A spectrum deal is a new development, so the market is clearly rethinking those risks.
The business was moving in the right direction before this selloff.
In Q2, Verizon added 184,000 postpaid phone net customers. Consumer churn fell to 84 basis points. Adjusted EPS rose 6.6% to $1.30, and free cash flow rose 24% to $6.4 billion.
The company raised its full-year guidance and lifted its buyback target to up to $4.5 billion.
So Verizon stock now has two things to weigh. The company’s results are improving, but a new competitor has entered the picture.
Investors will want to see how the FCC review plays out and how Verizon responds.
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So what is Verizon stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
