Verizon: Mobile Dominance on the Horizon

To finish our triad of the three major mobile service players, we are looking at Verizon Communications (VZ). Verizon is actually co-owned by VZ and Vodafone (VOD), which we will analyze later this week! To start off, Verizon was established in 1983, the same year as AT&T. The company, which focuses on wired and wireless communications, specializes in cellular providing, network cards/ mobile USB data ports, home networks and providers, as well as business solutions through Verizon Enterprise, comparable to AT&T Enterprise and Sprint Business; although Verizon offers other services, these comprise the majority which affect the business and financial changes we observe.

Right from the beginning, Verizon exhibited tremendous growth. Quintupling within a decade in the late 20th century, and tripling yet again into the Information Era to a record $63 a share, Verizon is easily one of the best growing companies we have observed, at least in early stages. Unfortunately, the end of the Information Era (the Internet boom and technological excitements between 1999-2001) also marked the end of this supreme stock reign, as stocks fell 50%. After seeing newfound growth from 2006 to 2007 and early 2008, the Recession hit and fell back to 2002 levels. Verizon, however, is now selling for $44.03 (similar to pre-recession costs). When we initially studied the company in recent times, we began in late October and early November, with traces of a steepening decline. Fortunately, we bought in mid-November when stocks hit their low and begin rising again. The only significant event in November was the case again Verizon Wireless (note the difference, --Communications and --Wireless). Verizon Wireless asked its two parent companies, Verizon Comm. and Vodafone, for a bailout of $17 billion, but instead of, well, bailing itself out, it spent it on further wireless developments. Even though this situation is like the Federal Government suing Bank of America, Verizon Wireless was forced to pay $8.5 billion each to Verizon Comm. and the latter.
As Verizon expands Verizon Wireless and improves the 4G networks and availability, as well as allow more competitive prices (remember that no company may monopolize a market and drive others out of business), the company will continue to grow. The expenditure of buying T-Mobile could also prove a worthy decision to aid with the expansion of the company globally. We currently expect Verizon to slow down a bit and for stocks to depreciate value, but they will quickly swing back up. Buy while cheap! We bought our stocks on Investopedia in mid-November when stocks hit their low, and on just a few shares have made $18. This is certainly a company worth investing, both in the short- and long-terms.