Here is What to Know Beyond Why Verizon Communications Inc. (VZ) is a Trending Stock

Verizon (VZ) is trending on Zacks.com, with shares down 4.8% over the past month versus the S&P 500's +0.6%. Despite this recent underperformance, Verizon's earnings estimates have seen slight positive revisions for the current and next fiscal years, with EPS projected to grow by 2.2% and 4%, respectively, and revenue expected to increase by 1.7% and 2.2%. The stock currently holds a Zacks Rank #3 (Hold), suggesting near-term performance in line with the broader market, and a Value Style Score of A, indicating it may be undervalued relative to its peers.

Analysis

Verizon Communications (VZ) shares have recently underperformed, declining 4.8% over the past month, in contrast to the S&P 500 composite's 0.6% gain and deeper than the Zacks Wireless National industry's 5.2% loss. Despite this market underperformance, fundamental indicators show some resilience; consensus earnings estimates for Verizon have experienced slight positive revisions. For the current quarter, EPS is projected at $1.18, representing a 2.6% year-over-year increase, with the Zacks Consensus Estimate having risen 0.1% in the last 30 days. For the current fiscal year, the consensus EPS estimate is $4.69, indicating a 2.2% annual growth, and for the next fiscal year, it is $4.88, a 4% projected increase, with these estimates also seeing marginal upward changes of +0.1% and +0.3% respectively over the past month. Revenue growth is also anticipated, with consensus sales estimates pointing to a 2.3% year-over-year increase to $33.54 billion for the current quarter, and annual growth of 1.7% to $137.12 billion for the current fiscal year and 2.2% to $140.08 billion for the next. Verizon's last reported quarterly revenues were $33.49 billion (+1.5% YoY), beating estimates by 0.48%, while EPS of $1.19 (up from $1.15 YoY) surpassed expectations by 3.48%, extending a streak of four consecutive EPS beats. The stock currently holds a Zacks Rank #3 (Hold), implying expected near-term performance in line with the market, and is notably graded 'A' on the Zacks Value Style Score, suggesting it trades at a discount relative to its peers.

Key Decisions for Investors

• Investors should weigh Verizon's recent share price underperformance and modest growth outlook against its consistently positive earnings surprises and attractive 'A' Value Style Score, which suggests potential undervaluation.
• Closely monitor upcoming earnings reports for sustained revenue growth in line with or exceeding the projected 1.7-2.3% range, as this will be key to supporting further earnings expansion and justifying the value thesis.
• Given the Zacks Rank #3 (Hold), indicating near-term alignment with market performance, consider maintaining existing positions if aligned with a value-oriented strategy, while awaiting more significant catalysts for potential re-rating.