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Can Modest Revenue Growth Propel Verizon (VZ) Q4 Earnings?
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Verizon Communications Inc. (VZ - Free Report) is scheduled to report fourth-quarter 2022 results before the opening bell on Jan 24. In the last reported quarter, the telecom giant beat the Zacks Consensus Estimate by 4 cents. The company is expected to have recorded higher aggregate revenues year over year, buoyed by the positive momentum in its core wireless business.
Factors at Play
During the fourth quarter, Verizon continued to deploy 100 MHz of C-Band spectrum to further expand its 5G coverage and covered more than 175 million people with 5G Ultra Wideband service. The company is witnessing significant 5G adoption and fixed wireless broadband momentum while increasing demand for premium mobility and broadband offerings instill optimism. It extended its high-speed fiber Internet across additional homes in Massachusetts. These are likely to get reflected in the upcoming quarterly results.
Verizon offered customers the Welcome Unlimited plan with unlimited talk, text and data on its 5G Nationwide network for just $25 per line per month for four lines. It also launched new Prepaid Unlimited plans for as low as $50 per month, including free access to Disney+ for six months. In addition to the new Unlimited plans, Verizon Prepaid offered a new 15GB data plan for as low as $35 per month with Auto Pay. These developments are likely to have had a positive impact on Verizon’s performance.
During the quarter, Verizon collaborated with Higi to provide digital health solutions and services to support preventative health, drive literacy and identify high-risk consumers eligible to be managed via home-based monitoring. It also partnered with Openloop to accelerate anytime, anywhere virtual care delivery. According to the terms of the collaboration, the firms will work in unison to provide rural communities and seniors with limited access to transportation with greater access to care powered by the Verizon 4G LTE and 5G Ultra Wideband networks. These initiatives are likely to have translated into incremental revenues in the quarter.
In the fourth quarter, Verizon inked an agreement with Wipro Limited to develop global Network-as-a-Service (NaaS) for network modernization and cloud transformation for businesses with a range of pre-configured and tested service chains on a subscription-based consumption model. However, adverse foreign currency translations and high operating costs for 5G deployments are likely to have led to soft margins in the quarter. The infrastructure investments are expected to have weighed on the margins.
For the December quarter, the Zacks Consensus Estimate for revenues is pegged at $35,150 million. It reported revenues of $34,067 million in the year-ago quarter. The consensus estimate for adjusted earnings per share stands at $1.21, which suggests a decline from the year-ago tally of $1.31.
Earnings Whispers
Our proven model does not predict an earnings beat for Verizon for the fourth quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -2.39%, with the former pegged at $1.18 and the latter at $1.21. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Verizon has a Zacks Rank #3.
Stocks to Consider
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
The Earnings ESP for T-Mobile US, Inc. (TMUS - Free Report) is +3.00% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Feb 1.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +10.19% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Feb 1.
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Can Modest Revenue Growth Propel Verizon (VZ) Q4 Earnings?
Verizon Communications Inc. (VZ - Free Report) is scheduled to report fourth-quarter 2022 results before the opening bell on Jan 24. In the last reported quarter, the telecom giant beat the Zacks Consensus Estimate by 4 cents. The company is expected to have recorded higher aggregate revenues year over year, buoyed by the positive momentum in its core wireless business.
Factors at Play
During the fourth quarter, Verizon continued to deploy 100 MHz of C-Band spectrum to further expand its 5G coverage and covered more than 175 million people with 5G Ultra Wideband service. The company is witnessing significant 5G adoption and fixed wireless broadband momentum while increasing demand for premium mobility and broadband offerings instill optimism. It extended its high-speed fiber Internet across additional homes in Massachusetts. These are likely to get reflected in the upcoming quarterly results.
Verizon offered customers the Welcome Unlimited plan with unlimited talk, text and data on its 5G Nationwide network for just $25 per line per month for four lines. It also launched new Prepaid Unlimited plans for as low as $50 per month, including free access to Disney+ for six months. In addition to the new Unlimited plans, Verizon Prepaid offered a new 15GB data plan for as low as $35 per month with Auto Pay. These developments are likely to have had a positive impact on Verizon’s performance.
During the quarter, Verizon collaborated with Higi to provide digital health solutions and services to support preventative health, drive literacy and identify high-risk consumers eligible to be managed via home-based monitoring. It also partnered with Openloop to accelerate anytime, anywhere virtual care delivery. According to the terms of the collaboration, the firms will work in unison to provide rural communities and seniors with limited access to transportation with greater access to care powered by the Verizon 4G LTE and 5G Ultra Wideband networks. These initiatives are likely to have translated into incremental revenues in the quarter.
In the fourth quarter, Verizon inked an agreement with Wipro Limited to develop global Network-as-a-Service (NaaS) for network modernization and cloud transformation for businesses with a range of pre-configured and tested service chains on a subscription-based consumption model. However, adverse foreign currency translations and high operating costs for 5G deployments are likely to have led to soft margins in the quarter. The infrastructure investments are expected to have weighed on the margins.
For the December quarter, the Zacks Consensus Estimate for revenues is pegged at $35,150 million. It reported revenues of $34,067 million in the year-ago quarter. The consensus estimate for adjusted earnings per share stands at $1.21, which suggests a decline from the year-ago tally of $1.31.
Earnings Whispers
Our proven model does not predict an earnings beat for Verizon for the fourth quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -2.39%, with the former pegged at $1.18 and the latter at $1.21. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Verizon has a Zacks Rank #3.
Stocks to Consider
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
Telephone and Data Systems, Inc. (TDS - Free Report) is set to release quarterly numbers on Feb 16. It has an Earnings ESP of +2.63% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for T-Mobile US, Inc. (TMUS - Free Report) is +3.00% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Feb 1.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +10.19% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Feb 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.