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Telecom Stock Roundup: Verizon Unlocks Value, Nokia Offers Automated Solution & More
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The U.S. telecom stocks witnessed a roller-coaster ride in the past week as geopolitical tensions took the center stage, triggering intense sector volatility. The latest discord was largely fueled by the fresh set of U.S. restrictions against China-based telecommunications equipment manufacturer Huawei. This apparently forced the industry to get polarized into two distinct halves, bringing an element of uncertainty within the rank and files of the telecom sector. The intense technology warfare between the two superpowers of the global economy is also likely to affect the supply-chain mechanism of domestic firms and dent their profitability.
The Trump administration added a fresh list of 38 Huawei affiliates to the "Entity List," alleging unfair means by these international subsidiaries to circumvent sanctions, which prevented the export of U.S.-based technology, in order to gain unlawful access to it. The new directive from the Commerce Department aimed to plug this loophole by making it mandatory for any overseas chipmaker that uses U.S. technology and sells it to Huawei to obtain a government license. The multi-pronged approach was aimed to cut off the supply of even generic chips harnessed by third-parties for Huawei consumption and was widely viewed as a death knell for the Chinese manufacturer.
Notably, the White House is seeking a ban on TikTok, WeChat and other Chinese apps that are allegedly being used as cyber espionage tools to gain access to sensitive American data. The Trump administration is further aiming to rip off Chinese apps from American mobile app marketplaces. At the same time, it is also preventing Chinese hardware manufacturers from pre-installing popular American apps on their devices. The confidence-building administrative efforts to set guardrails and legislations to lend support to domestic telecommunication companies and protect sovereign interests under the ‘Clean Cloud’ initiative have provided some respite to the beleaguered industry.
Regarding company-specific news, bundled offerings, collaborations, debt repayment and product launch took the center stage over the past five trading days.
Recap of the Week’s Most Important Stories
1. Verizon Communications Inc. (VZ - Free Report) recently aimed to reach a broader spectrum of customers by unlocking more value with a bundled offering at the same price. In this regard, the company has inked an agreement with The Walt Disney Company to offer more streaming content with its Mix & Match Unlimited plans.
The Mix and Match Unlimited plans allow users to pick and choose from the bouquet of entertainment options in addition to unlimited 5G coverage with compatible devices. Starting Aug 20, Verizon will offer five different types of Mix and Match Unlimited plans to provide customers the option to select their plan according to their convenience.
2. Nokia Corporation (NOK - Free Report) has inked an agreement with 3 Indonesia — a leading carrier in the Southeast Asian country — to optimize and expand the latter’s LTE network capabilities through an automated test solution. The Zero Drive Test solution will further enable Nokia to fulfill its environmental commitments for sustainable operations through zero-emission products, while offering improved network connectivity for superior user experience.
Contrary to manual drive tests for assessing network quality, coverage and capacity, the fully automated Zero Drive Test solution leverages Nokia’s AVA Cognitive Services, driven by AI, to augment network performance. It enables carriers to predict and promptly resolve potential network issues through an in-depth and detailed insight into the related metrics compared with conventional methods. This, in turn, reduces the carbon footprint through the removal of manual intervention activities while providing a comprehensive view of the network performance.
3. AT&T Inc. (T - Free Report) has issued notices for the early redemption of three series of bonds worth $1.2 billion to improve its liquidity position and reduce the burgeoning debt burden through prepayment of upcoming debt maturities. The strategic move is likely to de-risk its capital structure as the company prepares to navigate through the coronavirus-induced global turmoil.
With this announcement, AT&T has either refinanced or repaid $19.4 billion worth of debt since the end of the second quarter of 2020 either through make-whole redemptions, tender offers or repayment of scheduled maturities. This, in turn, will reduce its upcoming debt maturities within a year by $8.2 billion as the company aims to capitalize on low borrowing costs to de-lever its balance sheet.
4. Juniper Networks, Inc. (JNPR - Free Report) has teamed up with the Archdiocese of Brisbane and Centacare for the deployment of its Mist Cloud Services and Access Points (APs) for a streamlined network infrastructure. The latest collaboration is primarily aimed at revamping the overall Wi-Fi experience across the non-profit organization’s chain of mass centers, offices and educational institutions.
Powered by a microservices cloud architecture, the Mist Cloud Services transforms the networking experience with a reliable and predictable Wi-Fi system. Juniper’s APs simplify network operations and automate support experience using an integrated AI engine on the back of avant-garde data science tools.
5. Arista Networks, Inc. (ANET - Free Report) recently announced that it has modernized its network management platform — CloudVision — with the launch of a Software-as-a-Service (SaaS) solution in order to simplify resource-intensive tasks for a more automated cloud-like infrastructure.
Markedly, the latest move is primarily aimed at eradicating configuration challenges while enabling customers to focus more on flexible device deployments supported by an open standards-based architecture. Dubbed CloudVision as-a-Service, Arista’s new managed service platform operates on enhanced cloud principles, which automate multi-domain networks across hybrid, private and public clouds.
Price Performance
The following table shows the price movement of some of the major telecom stocks over the past week and the six months.
In the past five trading days, CenturyLink has been the best performer with its stock rising 4.4%, while Juniper was the biggest decliner with its stock declining 6.8%.
Over the past six months, Qualcomm has been the best performer with its stock appreciating 21.6%, while AT&T was the biggest decliner with its stock falling 29.7%.
Over the past six months, the Zacks Telecommunications Services industry declined 6.1%, while the S&P 500 gained 4.6%.
What’s Next in the Telecom Space?
In addition to the 5G deployments and product launches, all eyes will remain glued to how the administration continues to safeguard the interests of domestic telecom firms from Chinese threats.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
Telecom Stock Roundup: Verizon Unlocks Value, Nokia Offers Automated Solution & More
The U.S. telecom stocks witnessed a roller-coaster ride in the past week as geopolitical tensions took the center stage, triggering intense sector volatility. The latest discord was largely fueled by the fresh set of U.S. restrictions against China-based telecommunications equipment manufacturer Huawei. This apparently forced the industry to get polarized into two distinct halves, bringing an element of uncertainty within the rank and files of the telecom sector. The intense technology warfare between the two superpowers of the global economy is also likely to affect the supply-chain mechanism of domestic firms and dent their profitability.
The Trump administration added a fresh list of 38 Huawei affiliates to the "Entity List," alleging unfair means by these international subsidiaries to circumvent sanctions, which prevented the export of U.S.-based technology, in order to gain unlawful access to it. The new directive from the Commerce Department aimed to plug this loophole by making it mandatory for any overseas chipmaker that uses U.S. technology and sells it to Huawei to obtain a government license. The multi-pronged approach was aimed to cut off the supply of even generic chips harnessed by third-parties for Huawei consumption and was widely viewed as a death knell for the Chinese manufacturer.
Notably, the White House is seeking a ban on TikTok, WeChat and other Chinese apps that are allegedly being used as cyber espionage tools to gain access to sensitive American data. The Trump administration is further aiming to rip off Chinese apps from American mobile app marketplaces. At the same time, it is also preventing Chinese hardware manufacturers from pre-installing popular American apps on their devices. The confidence-building administrative efforts to set guardrails and legislations to lend support to domestic telecommunication companies and protect sovereign interests under the ‘Clean Cloud’ initiative have provided some respite to the beleaguered industry.
Regarding company-specific news, bundled offerings, collaborations, debt repayment and product launch took the center stage over the past five trading days.
Recap of the Week’s Most Important Stories
1. Verizon Communications Inc. (VZ - Free Report) recently aimed to reach a broader spectrum of customers by unlocking more value with a bundled offering at the same price. In this regard, the company has inked an agreement with The Walt Disney Company to offer more streaming content with its Mix & Match Unlimited plans.
The Mix and Match Unlimited plans allow users to pick and choose from the bouquet of entertainment options in addition to unlimited 5G coverage with compatible devices. Starting Aug 20, Verizon will offer five different types of Mix and Match Unlimited plans to provide customers the option to select their plan according to their convenience.
2. Nokia Corporation (NOK - Free Report) has inked an agreement with 3 Indonesia — a leading carrier in the Southeast Asian country — to optimize and expand the latter’s LTE network capabilities through an automated test solution. The Zero Drive Test solution will further enable Nokia to fulfill its environmental commitments for sustainable operations through zero-emission products, while offering improved network connectivity for superior user experience.
Contrary to manual drive tests for assessing network quality, coverage and capacity, the fully automated Zero Drive Test solution leverages Nokia’s AVA Cognitive Services, driven by AI, to augment network performance. It enables carriers to predict and promptly resolve potential network issues through an in-depth and detailed insight into the related metrics compared with conventional methods. This, in turn, reduces the carbon footprint through the removal of manual intervention activities while providing a comprehensive view of the network performance.
3. AT&T Inc. (T - Free Report) has issued notices for the early redemption of three series of bonds worth $1.2 billion to improve its liquidity position and reduce the burgeoning debt burden through prepayment of upcoming debt maturities. The strategic move is likely to de-risk its capital structure as the company prepares to navigate through the coronavirus-induced global turmoil.
With this announcement, AT&T has either refinanced or repaid $19.4 billion worth of debt since the end of the second quarter of 2020 either through make-whole redemptions, tender offers or repayment of scheduled maturities. This, in turn, will reduce its upcoming debt maturities within a year by $8.2 billion as the company aims to capitalize on low borrowing costs to de-lever its balance sheet.
4. Juniper Networks, Inc. (JNPR - Free Report) has teamed up with the Archdiocese of Brisbane and Centacare for the deployment of its Mist Cloud Services and Access Points (APs) for a streamlined network infrastructure. The latest collaboration is primarily aimed at revamping the overall Wi-Fi experience across the non-profit organization’s chain of mass centers, offices and educational institutions.
Powered by a microservices cloud architecture, the Mist Cloud Services transforms the networking experience with a reliable and predictable Wi-Fi system. Juniper’s APs simplify network operations and automate support experience using an integrated AI engine on the back of avant-garde data science tools.
5. Arista Networks, Inc. (ANET - Free Report) recently announced that it has modernized its network management platform — CloudVision — with the launch of a Software-as-a-Service (SaaS) solution in order to simplify resource-intensive tasks for a more automated cloud-like infrastructure.
Markedly, the latest move is primarily aimed at eradicating configuration challenges while enabling customers to focus more on flexible device deployments supported by an open standards-based architecture. Dubbed CloudVision as-a-Service, Arista’s new managed service platform operates on enhanced cloud principles, which automate multi-domain networks across hybrid, private and public clouds.
Price Performance
The following table shows the price movement of some of the major telecom stocks over the past week and the six months.
In the past five trading days, CenturyLink has been the best performer with its stock rising 4.4%, while Juniper was the biggest decliner with its stock declining 6.8%.
Over the past six months, Qualcomm has been the best performer with its stock appreciating 21.6%, while AT&T was the biggest decliner with its stock falling 29.7%.
Over the past six months, the Zacks Telecommunications Services industry declined 6.1%, while the S&P 500 gained 4.6%.
What’s Next in the Telecom Space?
In addition to the 5G deployments and product launches, all eyes will remain glued to how the administration continues to safeguard the interests of domestic telecom firms from Chinese threats.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>