Analyst Note| Michael Hodel, CFA |
Verizon’s efforts to attract and retain customers while promoting higher-end rate plans created solid momentum during the third quarter, driving strong wireless service and Fios revenue growth. While rivals haven’t yet reported results, Verizon’s market share is likely tracking a bit higher than we’d expected and revenue per customer is also growing faster than we’d anticipated. On the negative side, part of this growth comes with the added expense of delivering content like Disney+ to customers, which weighs on margins. We have made modest adjustments to our projections, resulting in a fair value estimate increase to $58 per share from $57. With the slide in its shares over the past couple of months, Verizon is starting to look attractive. We continue to prefer AT&T on a valuation basis, though.