VZ Stock Analysis and Market Implications

Key Financial Metrics

• P/E Ratio: 10.32
• Price Target: $47.35 (potential 10.88% upside)
• Dividend Yield: 6.35% ($2.71 annual dividend, $0.68 quarterly)
• Payout Ratio: 65.46%

Q1 2025 Performance

• Revenue: $33.5 billion (up 1.5%)
• Wireless Revenue Growth: +2.7%
• Adjusted EPS: $1.19 (up 3%)
• Operating Cash Flow Improvement: 1000 bps
• Free Cash Flow: $3.6 billion (up 33%)

2025 Guidance

• Wireless Revenue Growth: 2.0–2.8%
• Adjusted EBITDA Growth: Slightly faster than revenue growth
• Free Cash Flow Projection: ~$18 billion
• Mobile Sales Growth: 2.0–2.8%

Subscriber Trends

• Q1 2025 Losses: -356,000 consumer retail postpaid phone subscribers (more than double Q1 2024 losses)
• Gross Additions: +1.7 million (reversing Q4 2024 gains)

Strategic Initiatives

• Customer Retention: Introduced 3-year price locks and guaranteed trade-in promotions.
• Bundled Plans: Aggressive offers for mobile and home internet bundles.

Challenges and Risks

• Increased Competition: Driving subscriber losses despite retention efforts.
• Economic Concerns: Potential impact from Trump tariffs and economic slowdown.
• Customer Frustration: Issues with pricing, technical support, and service quality.
• Employee Satisfaction: Declining morale impacting performance (e.g., password issues).

Cultural and Operational Issues

• Disconnect Between Stakeholders: Misalignment between customer expectations (lower prices, better support) and employee frustrations (lack of respect, poor working conditions).
• Recent Rate Hikes: Contributing to potential churn.

Long-Term Implications

• Subscriber Growth Hurdles: Risks from competitive pressures and customer dissatisfaction.
• Market Position: Vulnerability to economic downturns and regulatory scrutiny.