Verizon raises 2026 mobility and broadband service revenue growth forecast to 2.5-3.0%
Company expects adjusted EPS for 2026 of $4.99-$5.04, up 6-7% year-over-year
Verizon forecasts 2026 free cash flow growth of 9-10% year-over-year
Overview
US telecom operator's Q2 adjusted EPS rose 6.6% yr/yr, beating analyst expectations
Q2 total operating revenue fell 0.7% yr/yr due to lower equipment revenue
Company raised full-year guidance and expanded share buyback target to up to $4.5 bln
Result Drivers
Equipment revenue decline - Co said total operating revenue fell due to a nearly 20% drop in equipment revenue, mainly from lower upgrade volumes and reduced device subsidies
Subscriber growth - Co reported strong postpaid phone and broadband net additions, citing new plans, converged offerings, and a loyalty program as drivers
Special items impact - Net income declined due to $1.8 bln in pre-tax special items, including a loss on disposition of business, asset rationalization, and severance charges
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 11 "strong buy" or "buy", 17 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the integrated telecommunications services peer group is "buy"
Wall Street's median 12-month price target for Verizon Communications Inc is $50.00, about 14.1% above its July 23 closing price of $43.82
The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 10 three months ago
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