Verizon, T-Mobile and AT&T logos beside a cell tower, symbolizing strong 2026 telecom gains. Key Points While telecom earnings cycles can feature clear winners and losers, this wasn't the case in Q4. The United States' Big Three telecom companies all impressed investors, for one reason or another. Still, Verizon delivered a standout performance, massively beating expectations on wireless customer additions. Interested in Verizon Communications Inc.? Here are five stocks we like better. For U.S. tel ...

Core Insights - Verizon Communications is expected to see significant growth in retail postpaid mobile user additions, projecting an increase of 750,000 to 1,000,000 users in 2026, compared to 362,000 in 2025 [1] - The adjusted earnings per share are anticipated to be between $4.90 and $4.95, exceeding market expectations [1] - Free cash flow is projected to reach at least $21.5 billion [1] Business Strategy - The company plans to focus on the integration of wireless and broadband services, benefiting from the acquisition of Frontier Communications, which has expanded its fiber assets [1] - Fixed wireless access and fiber broadband connections have surpassed 16.3 million [1] - CEO Hans Vestberg indicated that the company will streamline operations, including laying off over 13,000 employees, to reduce costs and advance business restructuring [1]

Industry Overview - The Zacks Wireless National industry is facing challenges such as high capital expenditures for infrastructure upgrades, tariff uncertainty, supply-chain disruptions due to geopolitical tensions, and high customer inventory levels [1][6] - Despite these challenges, the industry is expected to benefit from accelerated 5G deployment and extensive fiber densification in the long run [1] Key Players - Verizon Communications Inc. is likely to gain from increased demand for scalable infrastructure, focusing on 5G mobile networks and fixed wireless broadband [2][14] - AT&T Inc. is benefiting from fiber convergence and increased deployment of mid-band spectrum, with a commitment to closing the digital divide [2][16][17] - Liberty Latin America Ltd. is positioned to leverage its end-to-end communications platform and upgraded infrastructure for enterprise-grade connectivity [2][20] Financial Performance - The Zacks Wireless National industry has underperformed the S&P 500 and the broader Zacks Computer and Technology sector, declining 7.8% over the past year compared to the S&P 500's growth of 15.9% [9] - The industry is currently trading at a trailing 12-month EV/EBITDA of 9.03X, significantly lower than the S&P 500's 17.21X and the sector's 19.40X [12] Market Dynamics - Increased infrastructure spending is eroding short-term profit margins due to aggressive promotional expenses and a decline in linear TV subscribers [4] - The deployment of 5G and fiber networks is expected to enhance customer experience with improved coverage and speed, driven by advancements in technology [5] Investment Outlook - Verizon has a long-term earnings growth expectation of 4.8% and has gained 20.8% in the past year, currently holding a Zacks Rank 3 (Hold) [14] - AT&T has a long-term earnings growth expectation of 11.7% and has gained 12.2% over the past year, also holding a Zacks Rank 3 [17] - Liberty Latin America has gained 11.6% in the past year and holds a Zacks Rank 2 (Buy) [20]

Core Viewpoint - The National Advertising Division (NAD) has recommended that T-Mobile US, Inc. modify or discontinue its advertising claims regarding the free in-flight Wi-Fi benefit, as the claims were found to be misleading in comparison to Verizon Communications Inc.'s offerings [1][6]. Group 1: Advertising Claims - T-Mobile's website claimed that in-flight Wi-Fi is included in its plans, while Verizon charges $147.00 per month for the same service, implying that Verizon customers incur this cost [2][4]. - NAD determined that T-Mobile's advertising did not accurately represent the benefits for its customers or the costs incurred by Verizon customers, leading to potential consumer confusion [3][5]. Group 2: Evidence and Recommendations - T-Mobile provided evidence of frequent usage of its free in-flight Wi-Fi benefit but failed to substantiate claims regarding the costs incurred by Verizon customers [5]. - NAD recommended that T-Mobile either discontinue the challenged claims or modify them to clearly disclose that the fees avoided by T-Mobile customers are those charged by certain airlines, rather than implying that non-T-Mobile customers typically pay the stated monthly cost [6]. Group 3: Compliance and Industry Context - T-Mobile stated it would comply with NAD's recommendations regarding its already discontinued advertising claim [7]. - BBB National Programs, which oversees NAD, has been enhancing consumer trust in business for over 50 years through independent industry self-regulation [8].

Group 1 - Verizon's trading volume has surged significantly, indicating increased investor interest [1] - The company's stock price has recently increased by 3.0%, reflecting positive market sentiment [1]

Core Insights - Verizon Communications Inc. has been recognized among the Dividend Champions, Contenders, and Challengers List, highlighting its strong dividend yield [1] - TD Cowen raised its price target for Verizon from $51 to $54, maintaining a Buy rating due to better-than-expected phone subscriber additions in Q4, despite some impact on EBITDA [2] - Verizon reported its strongest net customer additions since 2019 in Q4 2025, meeting its full-year guidance, which is a significant indicator of telecom growth [3] Financial Performance - Verizon's operating revenue for the full year increased by 2.5% to $138.2 billion, with a notable 12% rise in share price on the earnings release day [4] - The company generated $20.1 billion in free cash flow over the past year, up from $19.8 billion the previous year, providing a solid cushion for dividend payments of approximately $11.6 billion [5] Strategic Developments - Verizon completed its acquisition of Frontier Communications in January, which enhances its fiber footprint and supports long-term growth strategies [4] - The company operates as a holding entity providing a range of communication, technology, information, and streaming services to various customer segments [6]

Core Insights - As of February 10, 2026, three stocks in the communication services sector are identified as potentially overbought, signaling caution for momentum-focused investors [1]. Group 1: Overbought Stocks - Comcast Corp (NASDAQ:CMCSA) is listed as one of the major overbought stocks in the communication services sector [3]. - Verizon Communications Inc (NYSE:VZ) is also highlighted as an overbought stock, indicating potential risk for investors [3]. - Charter Communications Inc (NASDAQ:CHTR) completes the list of overbought stocks, suggesting a need for careful evaluation by traders [3]. Group 2: Momentum Indicator - The Relative Strength Index (RSI) is a key momentum indicator used to assess stock performance, comparing strength on up days versus down days [2]. - An asset is typically considered overbought when the RSI exceeds 70, which may indicate a potential price correction [2].

Core Viewpoint - As of February 10, 2026, three stocks in the communication services sector are identified as potentially concerning for investors who prioritize momentum in their trading strategies [1]. Group 1: Momentum Indicator - The Relative Strength Index (RSI) is highlighted as a momentum indicator that assesses a stock's performance by comparing its strength on days with price increases to days with price decreases [2]. - An asset is generally deemed overbought when the RSI exceeds 70, which can signal potential short-term performance issues for traders [2]. Group 2: Overbought Stocks - The three major stocks in the communication services sector that are currently considered overbought include Comcast Corp (NASDAQ:CMCSA), Verizon Communications Inc (NYSE:VZ), and Charter Communications Inc (NASDAQ:CHTR) [3].

Verizon Communications Inc. (NYSE:VZ) is included among the 10 Most Profitable Undervalued Stocks to Buy RBC Capital Raises its Price Target on Verizon Communications Inc. (VZ) to $48 On February 3, 2026, RBC Capital raised its price target on Verizon Communications Inc. (NYSE:VZ) to $48 from $44 while maintaining a Sector Perform rating. The move followed Verizon’s fourth-quarter earnings beat. RBC pointed to the company’s turnaround plan, which centers on operating and capital expenditure reductions ai ...

Core Insights - The wireless industry has seen significant changes in competition and pricing strategies, particularly after T-Mobile's acquisition of Sprint, leading to a "big three" of carriers: T-Mobile, AT&T, and Verizon [2][15] - Verizon's new CEO, Dan Schulman, emphasizes a turnaround strategy focused on customer satisfaction and sustainable growth rather than short-term price increases [3][6][12] Financial Performance - In Q4 2025, Verizon reported an EPS of $0.55 and an adjusted EPS of $1.09, with total operating revenue of $36.4 billion and consolidated net income of $2.4 billion [8] - The company achieved total postpaid phone net additions of 616,000, marking the best quarter since 2019, and wireless service revenue increased by 1.1% year over year to $21.0 billion [8] Strategic Changes - Schulman has committed to avoiding price increases that do not correspond with added value, acknowledging that previous price hikes contributed to customer churn [5][6] - The company aims to enhance subscriber growth through a value-based pricing strategy and improved customer experience [4][12] Analyst Perspectives - Analysts express confidence in Schulman's strategy, noting that the reset in pricing aligns with Verizon's C-Band spectrum strategy and is expected to attract more subscribers [10][11] - Concerns remain about potential ARPU dilution as the company shifts focus towards unit growth, which may impact financial metrics in the short term [11][12] Future Guidance - Verizon's 2026 guidance indicates a focus on sustainable growth, projecting adjusted EPS of $4.90 to $4.95, representing a year-over-year growth of 4% to 5% [16] - The company anticipates total mobility and broadband service revenue growth of 2% to 3%, with wireless service revenue growth expected to be flat as it transitions to a volume-based growth model [16]