Verizon Communications Inc.

(New York Stock Exchange)
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Bullish +65

Verizon Stock Is Near a 52-Week High. Here’s Why I’m Still Bullish.

AI-generated analysis

📈 Verizon has posted six straight earnings beats, with Q2 2026 adjusted EPS of $1.30 beating the $1.27 consensus on revenue of $34.25 billion.

💰 Adjusted EBITDA margins expanded to 40.1% from 37.1%, and free cash flow jumped 27.12% to $6.426 billion in the second quarter.

📶 Fiber expansion is accelerating with expectations to exceed 32 million passings by year-end, targeting a medium-term goal of 40 to 50 million.

🤖 CEO Dan Schulman highlighted discussions with hyperscalers regarding dark fiber and lit fiber that could unlock multi-billion dollar revenue streams.

📉 Postpaid phone churn improved significantly to 0.92%, while postpaid phone net adds swung positive to 184,000 units from a loss of 9,000 a year prior.

💸 Management raised FY26 adjusted EPS guidance to $4.99-$5.04 and lifted the share buyback target to $4.5 billion.

🎯 Analysts rate Verizon as a BUY with a price target of $56.60, implying 11.6% upside from the current quote of $50.78.

⚖️ The company carries $136.5 billion in unsecured debt with net leverage at 2.5x, up from 2.2x post-Frontier acquisition.

📉 GAAP net income fell 21.07% due to $1.8 billion in special items, though adjusted EBITDA still grew 7.2%.

🔍 The bull-case target of $63.82 relies on delivering Q3 service revenue growth near the guided 3% and capturing early AI-infrastructure revenue.

⚠️ Key risks include leverage climbing above 2.7x or postpaid churn ticking back above 1%, which would negatively impact the stock thesis.

🏆 Verizon trades at a modest discount to AT&T's market cap despite similar shareholder return profiles, offering value in a yield-and-turnaround setup.

Bullish Signals
  • Verizon has posted six consecutive earnings beats, with Q2 2026 adjusted EPS of $1.30 beating the $1.27 consensus on revenue of $34.25 billion.
  • Adjusted EBITDA margins expanded to 40.1% from 37.1%, and free cash flow jumped 27.12% to $6.426 billion in the second quarter.
  • Management raised FY26 adjusted EPS guidance to $4.99-$5.04 and lifted the share buyback target to $4.5 billion, signaling strong confidence.
  • Fiber expansion is accelerating with expectations to exceed 32 million passings by year-end, targeting a medium-term goal of 40 to 50 million.
  • CEO Dan Schulman highlighted discussions with hyperscalers regarding dark fiber and lit fiber that could unlock multi-billion dollar revenue streams.
  • Postpaid phone churn improved significantly to 0.92%, while postpaid phone net adds swung positive to 184,000 units from a loss of 9,000 a year prior.
  • Analysts rate Verizon as a BUY with a price target of $56.60, implying 11.6% upside from the current quote of $50.78.
Risk Factors
  • The company carries $136.5 billion in unsecured debt with net leverage at 2.5x, up from 2.2x post-Frontier acquisition.
  • GAAP net income fell 21.07% due to $1.8 billion in special items, though adjusted EBITDA still grew 7.2%.
Full Analysis
Verizon (VZ) has emerged as a standout large-cap turnaround story, posting six consecutive earnings beats and climbing 29.5% year-to-date to approach its 52-week high. The company's Q2 2026 results delivered adjusted EPS of $1.30 against consensus estimates, driven by revenue of $34.25 billion and a significant expansion in Adjusted EBITDA margins to 40.1%. Free cash flow surged 27.12% to $6.426 billion, while postpaid phone net adds swung positive to 184,000 units, marking a structural inflection point according to CEO Dan Schulman. Management has raised full-year 2026 adjusted EPS guidance to between $4.99 and $5.04 and increased the share buyback target to $4.5 billion. Analysts at 24/7 Wall St. maintain a BUY rating with a price target of $56.60, implying 11.6% upside from current levels. The bullish thesis rests on three primary growth levers: aggressive fiber expansion targeting 40 to 50 million passings by the medium term, potential multi-billion dollar revenue streams from hyperscaler AI infrastructure deals, and improved customer retention with postpaid churn dropping to 0.92%. Despite challenges including $136.5 billion in unsecured debt and a net leverage ratio of 2.5x following the Frontier acquisition, analysts view special items as non-recurring. The stock trades at a lower implied multiple compared to peers like AT&T and T-Mobile, offering a yield-and-turnaround setup. Key risks include leverage climbing above 2.7x or postpaid churn rising back above 1%, which would weaken the investment thesis. Execution on fiber build-out and synergy extraction from Frontier remains critical for realizing the bull-case target of $63.82.