Verizon Communications Inc. (NYSE:VZ) experienced a decline in its share price, falling by 1.1% during trading on Thursday. The stock reached a low of $40.65 before closing at $40.7550, following a previous close of $41.19. Trading volume increased significantly, with approximately 31,780,874 shares exchanged, reflecting a 41% rise compared to its average daily volume of 22,534,889 shares.
Analyst Downgrades Impact Market Sentiment
Recent analyst reports have influenced market perceptions of Verizon. On September 26, 2023, Wall Street Zen downgraded the company from a “buy” rating to a “hold” rating. Following this, Weiss Ratings similarly adjusted its rating from “buy (b-)” to “hold (c+)” on October 24, 2023. Notably, JPMorgan Chase & Co. reduced its price target for Verizon from $49.00 to $47.00 with a “neutral” rating issued on October 30, 2023. The Royal Bank of Canada also cut its target to $44.00, while Scotiabank increased its price objective from $50.50 to $51.00, maintaining a “sector perform” rating.
Investor sentiments reflect a cautious outlook, with two analysts rating the stock as a Strong Buy, six assigning a Buy rating, and thirteen categorizing it as a Hold. According to data from MarketBeat.com, Verizon currently holds an average rating of “Hold” and has a consensus price target of $47.41.
Quarterly Earnings and Dividend Announcement
Verizon’s latest earnings report, released on October 29, 2023, revealed an earnings per share (EPS) of $1.21, slightly surpassing the analysts’ consensus of $1.19 by $0.02. The company reported a net margin of 14.43% and a return on equity of 19.31%. Revenue for the quarter was $33.82 billion, falling short of analysts’ expectations of $34.19 billion. In comparison to the previous year, Verizon’s quarterly revenue showed a modest increase of 1.5%.
In a positive move for investors, Verizon declared a quarterly dividend of $0.69, paid on November 3, 2023. This dividend marks an increase from the previous quarter’s dividend of $0.68, representing an annualized basis of $2.76 and a yield of 6.7%. The company’s dividend payout ratio currently stands at 58.97%.
Institutional investors maintain a significant presence in Verizon, holding 62.06% of the company’s stock. Recent activity includes Kestra Investment Management LLC increasing its stake by 121.8% in the first quarter, acquiring an additional 96,931 shares to total 176,531 shares valued at $8,007,000. Similarly, Cadinha & Co. LLC expanded its holdings by an impressive 2,916.8%, now owning 347,716 shares worth $15,046,000.
As Verizon continues to navigate these market dynamics, the upcoming fiscal outlook remains a focus for both analysts and investors alike.
