Verizon Communications Inc. shares slipped Monday, giving back some gains after closing nearly 6% higher on Friday. The decline came despite a fresh research report from Morningstar suggesting the telecom giant remains attractively valued even in a tougher competitive landscape.
Morningstar analyst, citing a fair value estimate of $54 per share, sees more than 23% upside from last week’s close. The firm maintained a “Narrow Economic Moat” rating and a “Medium” uncertainty assessment on Verizon.
Wireless operations generate about 75% of service revenue and nearly all of the company’s operating income, Morningstar noted. The acquisition of Frontier Communications has expanded Verizon’s fiber footprint, strengthening its ability to bundle broadband and wireless services.
Looking ahead, the analyst expects Verizon’s wireless service revenue to remain roughly flat in 2026. Over the following five years, growth is forecast at around 2% annually, accelerating to about 3% in 2028 as customers migrate to new plans.
Verizon’s strong network quality—across both wireless and fixed-line technologies—and its powerful brand reputation have attracted a large, loyal customer base. “In the wireless business, the firm holds roughly 35% of the US postpaid phone market, claiming about 10% more customers than T-Mobile and 25% more than AT&T,” Morningstar said. “Leading scale enables Verizon to generate the highest margins and returns on capital in the industry.”
The report also highlighted Verizon’s dividend. “Verizon shares offer a fantastic dividend yield. The payout consumes less than 60% of free cash flow, providing plenty of cushion to maintain this income stream for shareholders,” Morningstar added.
In a separate development, Verizon appointed Dan Schulman as CEO earlier this year, a move that some analysts believe could improve execution and unlock shareholder value. The stock has been under pressure amid intense competition, but the new management’s strategy is being closely watched.
Monday’s dip came after two consecutive days of gains, with the stock outperforming some competitors on strong trading volume. Market participants will now monitor Verizon’s upcoming earnings for further clues on its trajectory.
