Verizon Communications Inc., known as just Verizon is one of
the leading holding companies in the global market. Incorporated in October,
1983, it is one of the world’s biggest providers of communication, information
and entertainment services to a very large specter of customers, ranging from
individual consumers to businesses and government agencies. Its two primary
segments are the brands Verizon Wireless and Wire line.
The first entity is concerned with communications products
and services, such as wireless voice and data, as well as equipment retail.
This is one of the most diversified segments of the company operations when it
comes to target audience, as it varies from small business to business
operations to large, international customers.
Wire line’s products include Internet access, broadband data, protocol
network services and access as well as long distance services. The main target groups
for these products are consumers in the US, but the reach of the company goes
well over the world, with operations set up in 150 countries.
One of the latest major acquisitions of Verizon Wireless was
a main portion of Cellular One shares from the Cellular Corporation. It is a
company with very strong research and development division, one that can truly
help Verizon with its own operations. Furthermore, the US giant also acquired
HUGHES Telematic and upLynk – technological and TV cloud companies. Their
server bases are proving to be a valuable asset for the large Verizon network,
as increasing demand has caused difficulties for the company to keep up with
its own servers.
The main operations of the company are voice and data
services, from where revenues come on prepaid basis. This has its impact on the
Verizon’s financial statements, and the Cash flow analysis is much better than
the average for the industry with such a system. However, Verizon’s stock price
fell in the last year from $53 to $48. Today its $4.48 EPS ratio, as well as
the large dividend payout of 4.23% has made again the company a center of
attention in the financial world. For the last weeks VZ stock quotes have
been increasing with an average of 4%.
Despite this recent success, over the last quarter times
were definitely tough for Verizon. Recent speculations about whether the US
economy will be able to recover as quickly as predicted from its winter
downturn, along with geological concerns about the state of the global economy
in key segments, has led to a large decrease in confidence from investors.
Companies like Dow Jones Industrials are experiencing a trembling decline in a
matter of days. Even though Verizon’s stock survived the speculations and even
gained 0.2% for the period it was also hit by the negative trend affecting all
of its wireless network rivals. One of the biggest issues for Verizon is
whether the small competitors that recently entered the market will be provided
with increased subsidizing from the government with its latest programs for the
wireless spectrum and declining purchases for the last years. It is mainly a
political issue, yet it has hit the stock market, making VZ stock prices
fluctuation with a large variance for the past three months.
The vote that is going to be held in a week is going to
determine the future performance not only for Verizon, but also for the whole
sector. Investors are on their toes, holding their assets and hoping for the
best – if the vote is favorable for the current market leaders VZ’s share value
is expected to increase up to $53 over the next several weeks.
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