Is Verizon (VZ) poised for a big business bounced? For quite some time we’ve all speculated that Verizon might end up with an iPhone to sell—putting an end to AT&T’s (T) exclusivity. Today, it’s been reported via Barclay’s that Verizon could indeed start selling the iPhone 4 early next year.
Before going forward, I should point out that I may have a financial interest in Verizon stock depending on when you read this.
The biggest issue is profit. While obtaining the iPhone next year will be a big step forward, will this mean more profit for the company? James Ratcliffe, Barclays analyst isn’t so sure. He estimates Verizon’s subscriber base could increase by 900,000, which according to my math would be a huge increase of 47%. However, because of the subsidies VZ would use to lure customers, he cut Verizon’s profit forecast for 2011.
“We believe most of the activations will come from pent-up iPhone demand from Verizon’s current subscriber base,” Ratcliffe said.
In other, perhaps connected, news, Verizon’s CFO, John Killian talked about the need to change their data pricing structure. It looks like they will follow AT&T’s lead on this one. Could this be yet another sign that the iPhone is nearing Verizon land? Currently, no one at the company is talking about when these changes will take place.
Verizon Communications’ stock remained largely unaffected by the news. It traded in a range of $29.01 – $29.38 and closed at $29.06. Volume was about 3 million shares under its average. It’s trading just a few dollars above the 52-week low of $26.49.
My name is Jason A. Martin. I'm an investor/trader, financial writer and entrepreneur. This is my blog. I also run a social media integration & cross-media design company. If you'd like to follow me on twitter, here's the link: Jason A. Martin
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My name is Jason A. Martin and this is my investment blog. Back in Jr. High School I fell in love with an electrical wiring company's stock on Wall Street. After following the stock daily in the papers—the Internet wasn't around back then—I sent them a letter and they sent me back all sorts of wonderful information about their company.
In High School, we had a stock market contest. All the kids were picking companies that made stuff they consumed. When I announced my beloved company, I was laughed at. Little did they know that my company was going to be the subject of a takeover soon.
Long story short, I won the contest and have made money in the stock market, through real estate investing, currency trading and so forth.
I hope you enjoy Financial Rebel. If you do, please leave your comments and share this site with those you know.
Jason
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