BNP Paribas Downgrades Verizon Stock Amid Leadership Change

NEW YORK, NY – BNP Paribas analyst Sam McHugh cut his price target for Verizon Communications (VZ) stock to $44 per share on Tuesday. This decision comes amid uncertainties surrounding the telecom giant’s strategy after a recent leadership change.

McHugh lowered his outlook on VZ, downgrading it from Outperform to Neutral. Despite this reduction, the new price target indicates an approximately 8% upside potential. Earlier this month, Verizon announced that Dan Schulman, a former CEO of PayPal, would take over for Hans Vestberg.

The leadership transition occurs as Verizon grapples with net losses among its postpaid phone subscribers, facing stiff competition from companies like Comcast, Charter, and T-Mobile. McHugh noted that, while some saw the leadership shift as a positive, it raised concerns about Verizon’s strategic direction.

Wells Fargo echoed these sentiments, highlighting the potential risks that could impact Verizon’s market position. The downgrade is noteworthy, particularly as the company seeks to enhance its network coverage in remote areas through a partnership with AST SpaceMobile. This collaboration aims to integrate low-Earth-orbit satellites into Verizon’s existing network.

Despite these developments, AST SpaceMobile’s stock has seen a significant increase since the beginning of the year, whereas VZ stock has risen only about 9% in the same timeframe. On Wall Street, Verizon currently holds a Moderate Buy consensus rating, based on eight Buys and 10 Holds from 18 analysts in the past three months. The average price target of $48.03 suggests a potential growth of around 19% from its current level.