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Verizon or Charter: Which Telecom Stock is the Smarter Investment?
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Key Takeaways
Verizon is expanding its 5G and fiber reach, including a $20B acquisition of Frontier Communications.
Charter is growing its mobile and rural broadband services, backed by a $7B fiber infrastructure plan.
VZ has strong cash flow but margin pressure; CHTR leads EPS growth but carries heavy debt burden.
Verizon Communications (VZ - Free Report) and Charter Communications (CHTR - Free Report) are both major players in the U.S. telecommunications industry. They primarily compete in fixed broadband, wireless services and enterprise connectivity verticals. Charter is the second largest cable operator in the United States and a leading broadband communications company providing video, Internet and voice services. The company served approximately 30.1 million customers in 41 states through its Spectrum brand.
Verizon, the leading wireless carrier in the United States, delivers communication services to a vast customer base across the public sector, small and medium businesses and global enterprises as well.
The U.S. telecommunication industry is rapidly changing owing to a multiple factor. Digital transformation initiatives, cloud adoption, remote work, smart homes, and growing AI usage are driving demand for high-speed Internet. Government initiatives, such as BEAD funding program to bridge up the digital divide in rural areas, are also acting as a catalyst. Amid this backdrop, let us analyze in depth the competitive strengths and weaknesses of the companies to understand who is in a better position to maximize gains from the emerging market trends.
The Case for Verizon
Verizon is benefiting from the growing demand for its industry-leading 5G portfolio. The company recently secured a multibillion-dollar contract from Thames Freeport in the United Kingdom. Per the deal, Verizon will deploy private 5G networks in major logistics, manufacturing, and innovation sites along the River Thames Estuary. Contract win in one of the busiest maritime logistic hubs in the region serves as a testament to the growing demand for VZ’s 5G capabilities. The company is collaborating with Nokia to execute the project.
Its 5G network primarily relies on three fundamental drivers to unlock the full potential of next-generation wireless technology. These include massive spectrum holdings, particularly in the millimeter-wave bands for faster data transfer, end-to-end deep fiber resources and the ability to deploy a large number of small cells. Moreover, growing usage of advanced data analytics, AI, edge computing and IoT infrastructure deployments is expected to drive demand for Verizon’s 5G network in the long run.
The company is also betting big on Fiber network expansion as well. Verizon is set to acquire Frontier Communications in a $20 billion deal. Frontier boasts 2.2 million fiber subscribers across 25 states in the United States. Frontier has been steadily investing in its fiber network; the company expects an additional 2.8 million fiber spots in addition to its current 7.2 million places by 2026. This will significantly boost Verizon’s fiber footprint.
However, the company operates in a highly competitive market and faces competition from other major players, such as AT&T, Inc. (T - Free Report) , Charter, and T-Mobile. AT&T is also aggressively expanding its fiber footprint. The company is acquiring Lumen’s fiber business. It is placing a strong focus on the densification of its existing fiber infrastructure. Such initiatives from AT&T can pose a challenge to Verizon’s fiber network expansion. In a bid to expand its customer base, Verizon is spending heavily on promotion and is also offering lucrative discounts, which are weighing on margins. VZ’s debt-to-cap ratio stands at 58.5%, while the current ratio is at 0.61.
The Case for Charter
Charter is witnessing growth in residential mobile service and residential Internet services. The company has expanded its 5G coverage nationwide. Its Spectrum Mobile is the core element of Charter’s converged network strategy, which aims to deliver highly competitive, simple data plans and pricing and ensure a premium connectivity experience for end users. The company is increasing collaboration with federal, state and local governments to bring Spectrum Internet to rural and underserved regions.
Charter has pledged to invest $7 billion to add 100,000+ miles of fiber-optic network infrastructure. The company intends to deliver multigigabit and symmetrical Internet services across 1.7 million locations. The company recently expanded its gigabit broadband, mobile, TV and voice services in the states of Wisconsin, Tennessee and Indiana. With up to 1 Gbps, advanced WiFi, and 100% U.S.-based customer service, the company is steadily expanding Spectrum’s footprint across the country.
Expansion of its network infrastructure is opening up new revenue-generating opportunities. Nexar, a prominent AI-powered mobility solution provider, has opted to leverage Spectrum’s expansive managed wireless network to facilitate faster delivery of roadway insights to the cloud faster and more efficiently. Successful integration will boost Charter’s prospects in the emerging market of vehicle safety and data-driven mobility infrastructure vertical.
However, the company operates in a fiercely competitive and saturated U.S. wireless market. It faces stiff competition from major players like AT&T, Verizon and T-Mobile. Charter has a leveraged balance sheet. As of March 31, 2025, the total principal amount of debt was $93.6 billion. Its debt-to-cap ratio stands at 82.6%, while its current ratio is at 0.36.
How Do Zacks Estimates Compare for VZ & CHTR?
The Zacks Consensus Estimate for Verizon’s 2025 sales and EPS implies year-over-year growth of 1.75% and 1.96%, respectively. The EPS estimate for 2025 has been trending southward over the past 60 days, while the 2026 EPS estimate has improved 0.82% over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Charter’s 2025 sales and EPS implies year-over-year growth of 0.33% and 13.01%, respectively. The EPS estimates have been trending downward over the past 60 days.
Image Source: Zacks Investment Research
Over the past six months, Verizon has gained 7.3%, while Charter has improved 11.9%.
Image Source: Zacks Investment Research
Verizon looks more attractive than Charter from a valuation standpoint. Going by the price/earnings ratio, Charter’s shares currently trade at 9.48 forward earnings, higher than 8.67 for Verizon.
Charter has shown steady revenue growth over the past few years, while Verizon has been witnessing a bumpy road. Downtrend in estimate for both 2025 and 2026 shows dwindling investor sentiment on Charter. However, Verizon’s comprehensive wireless and fiber network, which includes C-band spectrum, Fios infrastructure, combined with a strong focus on service reliability, gives it a clear competitive edge. Hence, with a robust cash flow and a healthy dividend payout ratio, Verizon appears to be a better investment option right now.
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Verizon or Charter: Which Telecom Stock is the Smarter Investment?
Key Takeaways
Verizon Communications (VZ - Free Report) and Charter Communications (CHTR - Free Report) are both major players in the U.S. telecommunications industry. They primarily compete in fixed broadband, wireless services and enterprise connectivity verticals. Charter is the second largest cable operator in the United States and a leading broadband communications company providing video, Internet and voice services. The company served approximately 30.1 million customers in 41 states through its Spectrum brand.
Verizon, the leading wireless carrier in the United States, delivers communication services to a vast customer base across the public sector, small and medium businesses and global enterprises as well.
The U.S. telecommunication industry is rapidly changing owing to a multiple factor. Digital transformation initiatives, cloud adoption, remote work, smart homes, and growing AI usage are driving demand for high-speed Internet. Government initiatives, such as BEAD funding program to bridge up the digital divide in rural areas, are also acting as a catalyst. Amid this backdrop, let us analyze in depth the competitive strengths and weaknesses of the companies to understand who is in a better position to maximize gains from the emerging market trends.
The Case for Verizon
Verizon is benefiting from the growing demand for its industry-leading 5G portfolio. The company recently secured a multibillion-dollar contract from Thames Freeport in the United Kingdom. Per the deal, Verizon will deploy private 5G networks in major logistics, manufacturing, and innovation sites along the River Thames Estuary. Contract win in one of the busiest maritime logistic hubs in the region serves as a testament to the growing demand for VZ’s 5G capabilities. The company is collaborating with Nokia to execute the project.
Its 5G network primarily relies on three fundamental drivers to unlock the full potential of next-generation wireless technology. These include massive spectrum holdings, particularly in the millimeter-wave bands for faster data transfer, end-to-end deep fiber resources and the ability to deploy a large number of small cells. Moreover, growing usage of advanced data analytics, AI, edge computing and IoT infrastructure deployments is expected to drive demand for Verizon’s 5G network in the long run.
The company is also betting big on Fiber network expansion as well. Verizon is set to acquire Frontier Communications in a $20 billion deal. Frontier boasts 2.2 million fiber subscribers across 25 states in the United States. Frontier has been steadily investing in its fiber network; the company expects an additional 2.8 million fiber spots in addition to its current 7.2 million places by 2026. This will significantly boost Verizon’s fiber footprint.
However, the company operates in a highly competitive market and faces competition from other major players, such as AT&T, Inc. (T - Free Report) , Charter, and T-Mobile. AT&T is also aggressively expanding its fiber footprint. The company is acquiring Lumen’s fiber business. It is placing a strong focus on the densification of its existing fiber infrastructure. Such initiatives from AT&T can pose a challenge to Verizon’s fiber network expansion. In a bid to expand its customer base, Verizon is spending heavily on promotion and is also offering lucrative discounts, which are weighing on margins. VZ’s debt-to-cap ratio stands at 58.5%, while the current ratio is at 0.61.
The Case for Charter
Charter is witnessing growth in residential mobile service and residential Internet services. The company has expanded its 5G coverage nationwide. Its Spectrum Mobile is the core element of Charter’s converged network strategy, which aims to deliver highly competitive, simple data plans and pricing and ensure a premium connectivity experience for end users. The company is increasing collaboration with federal, state and local governments to bring Spectrum Internet to rural and underserved regions.
Charter has pledged to invest $7 billion to add 100,000+ miles of fiber-optic network infrastructure. The company intends to deliver multigigabit and symmetrical Internet services across 1.7 million locations. The company recently expanded its gigabit broadband, mobile, TV and voice services in the states of Wisconsin, Tennessee and Indiana. With up to 1 Gbps, advanced WiFi, and 100% U.S.-based customer service, the company is steadily expanding Spectrum’s footprint across the country.
Expansion of its network infrastructure is opening up new revenue-generating opportunities. Nexar, a prominent AI-powered mobility solution provider, has opted to leverage Spectrum’s expansive managed wireless network to facilitate faster delivery of roadway insights to the cloud faster and more efficiently. Successful integration will boost Charter’s prospects in the emerging market of vehicle safety and data-driven mobility infrastructure vertical.
However, the company operates in a fiercely competitive and saturated U.S. wireless market. It faces stiff competition from major players like AT&T, Verizon and T-Mobile. Charter has a leveraged balance sheet. As of March 31, 2025, the total principal amount of debt was $93.6 billion. Its debt-to-cap ratio stands at 82.6%, while its current ratio is at 0.36.
How Do Zacks Estimates Compare for VZ & CHTR?
The Zacks Consensus Estimate for Verizon’s 2025 sales and EPS implies year-over-year growth of 1.75% and 1.96%, respectively. The EPS estimate for 2025 has been trending southward over the past 60 days, while the 2026 EPS estimate has improved 0.82% over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Charter’s 2025 sales and EPS implies year-over-year growth of 0.33% and 13.01%, respectively. The EPS estimates have been trending downward over the past 60 days.
Image Source: Zacks Investment Research
Over the past six months, Verizon has gained 7.3%, while Charter has improved 11.9%.
Image Source: Zacks Investment Research
Verizon looks more attractive than Charter from a valuation standpoint. Going by the price/earnings ratio, Charter’s shares currently trade at 9.48 forward earnings, higher than 8.67 for Verizon.
Image Source: Zacks Investment Research
End Note
Charter and Verizon carry a Zacks Rank #3 (Hold) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Charter has shown steady revenue growth over the past few years, while Verizon has been witnessing a bumpy road. Downtrend in estimate for both 2025 and 2026 shows dwindling investor sentiment on Charter. However, Verizon’s comprehensive wireless and fiber network, which includes C-band spectrum, Fios infrastructure, combined with a strong focus on service reliability, gives it a clear competitive edge. Hence, with a robust cash flow and a healthy dividend payout ratio, Verizon appears to be a better investment option right now.