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VZ vs. ASTS: Which Telecom Stock Has the Stronger Investment Case?
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Key Takeaways
VZ and ASTS are pursuing different strategies to tap growth in the wireless connectivity market.
VZ's subscriber gains, fiber expansion and rising cash flow contrast with ASTS' satellite deployment plans.
VZ and ASTS differ sharply in stock performance, valuation and earnings growth expectations.
Verizon Communications (VZ - Free Report) and AST SpaceMobile (ASTS - Free Report) are pursuing opportunities to expand wireless connectivity, but their business models and investment profiles are different. Verizon is building on its established wireless and broadband operations, focusing on subscriber growth, fiber expansion and stronger cash generation. AST SpaceMobile, meanwhile, is developing a satellite-based cellular network designed to deliver connectivity directly to standard smartphones in areas with limited terrestrial coverage.
The global wireless connectivity market is poised for significant expansion, creating opportunities for companies developing next-generation communication technologies. According to Precedence Research, the market is projected to grow from $134.77 billion in 2026 to $412.84 billion by 2035, representing a compound annual growth rate of 13.31%. As connectivity demands increase, traditional wireless infrastructure and emerging satellite-to-smartphone services could play complementary roles in extending network reach and improving accessibility. Let us delve deeper into the companies’ competitive dynamics to see which is better positioned in this broader sector.
The Case for Verizon
Verizon is strengthening its position in the U.S. wireless and broadband market through improving subscriber trends and an expanded fiber footprint. In its latest reported quarter, the company added 184,000 postpaid phone subscribers and 348,000 broadband connections, taking its combined fixed wireless access and fiber broadband base to approximately 17.1 million.
Consumer postpaid phone churn also improved sequentially, indicating better customer retention. The integration of Frontier Communications has expanded Verizon’s fiber reach across 31 states and Washington, D.C., creating an additional opportunity to bundle wireless and broadband services and deepen customer relationships. However, Verizon faces some challenges. Intense competition in the U.S. wireless market could limit pricing flexibility.
The company’s improving operating performance is supporting its earnings and cash flow outlook. Mobility and broadband service revenues increased 2.8% year over year, while adjusted EBITDA reached a record $13.7 billion and adjusted earnings rose 6.6% to $1.3 per share. Free cash flow increased 24.4% year over year during the quarter, prompting management to raise its full-year 2026 adjusted EPS growth and free cash flow growth outlooks to 6-7% and 9-10%, respectively. Beyond its core operations, Verizon is pursuing additional opportunities in AI infrastructure, including a dark-fiber agreement worth more than $1 billion to support Google’s AI data centers.
The Case for ASTS
AST SpaceMobile is pursuing a transformative opportunity in satellite-enabled cellular connectivity. Its large phased-array satellites are designed to connect directly with conventional smartphones, potentially extending coverage to remote areas and locations beyond the reach of terrestrial networks. The company has expanded its in-orbit constellation to 13 satellites and plans to reach about 45 by early 2027. Its commercial ecosystem is also growing: AST SpaceMobile has partnerships with more than 60 mobile network operators representing over 3 billion subscribers.
A second-quarter revenue backlog of approximately $1.3 billion, supported by commercial agreements and U.S. government awards, provides a foundation for its planned expansion. The company also reiterated its full-year 2026 revenue guidance of $150-$200 million, while regulatory progress and international partnerships could broaden its addressable market.
Despite these opportunities, AST SpaceMobile faces substantial execution and financial risks. Satellite deployment depends on successful launches, manufacturing capacity and complex network integration. The company recorded a $125.9 million loss on involuntary conversion in the second quarter of 2026. Competitive intensity could pose a significant challenge for AST SpaceMobile as SpaceX (SPCX - Free Report) expands its Starlink Mobile business. SpaceX is already providing satellite-to-mobile connectivity through partnerships with wireless operators. The company is developing next-generation satellites designed to deliver greater network capacity and broadband connectivity directly to smartphones.
Furthermore, AST SpaceMobile remains unprofitable. It reported a GAAP net loss of $230.9 million in the second quarter, while total operating expenses climbed to $329.1 million. Although its liquidity position improved following additional financing, continued satellite production and launch activity will require substantial capital. Its valuation also leaves limited room for execution setbacks.
How Do Zacks Estimates Compare for VZ & ASTS?
The Zacks Consensus Estimate for Verizon’s 2026 sales and EPS implies year-over-year growth of 2.45% and 5.5%, respectively. The EPS estimate for 2026 has moved northward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AST SpaceMobile’s 2026 sales implies year-over-year growth of 201.7%, while that for EPS suggests growth of 8.8%. The EPS estimate has declined over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of VZ & ASTS
Over the past year, VZ shares have gained 9.2% against ASTS’ decline of 47.6%.
Image Source: Zacks Investment Research
Verizon looks more attractive than AST SpaceMobile from a valuation standpoint. Going by the price/sales ratio, ASTS’ shares currently trade at 32.11 forward sales, significantly higher than 1.27 for VZ.
Both Verizon and AST SpaceMobile are pursuing opportunities to expand next-generation connectivity, but Verizon offers a more balanced investment case at present. ASTS has made progress in satellite deployment and mobile operator partnerships, although launch uncertainties, continued losses and a premium valuation remain concerns. Verizon, meanwhile, is benefiting from improving wireless subscriber additions, broadband expansion and stronger cash generation. Its investments in fiber infrastructure and AI connectivity could support future growth. Owing to these factors, Verizon is a better investment option at present.
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Image: Bigstock
VZ vs. ASTS: Which Telecom Stock Has the Stronger Investment Case?
Key Takeaways
Verizon Communications (VZ - Free Report) and AST SpaceMobile (ASTS - Free Report) are pursuing opportunities to expand wireless connectivity, but their business models and investment profiles are different. Verizon is building on its established wireless and broadband operations, focusing on subscriber growth, fiber expansion and stronger cash generation. AST SpaceMobile, meanwhile, is developing a satellite-based cellular network designed to deliver connectivity directly to standard smartphones in areas with limited terrestrial coverage.
The global wireless connectivity market is poised for significant expansion, creating opportunities for companies developing next-generation communication technologies. According to Precedence Research, the market is projected to grow from $134.77 billion in 2026 to $412.84 billion by 2035, representing a compound annual growth rate of 13.31%. As connectivity demands increase, traditional wireless infrastructure and emerging satellite-to-smartphone services could play complementary roles in extending network reach and improving accessibility. Let us delve deeper into the companies’ competitive dynamics to see which is better positioned in this broader sector.
The Case for Verizon
Verizon is strengthening its position in the U.S. wireless and broadband market through improving subscriber trends and an expanded fiber footprint. In its latest reported quarter, the company added 184,000 postpaid phone subscribers and 348,000 broadband connections, taking its combined fixed wireless access and fiber broadband base to approximately 17.1 million.
Consumer postpaid phone churn also improved sequentially, indicating better customer retention. The integration of Frontier Communications has expanded Verizon’s fiber reach across 31 states and Washington, D.C., creating an additional opportunity to bundle wireless and broadband services and deepen customer relationships. However, Verizon faces some challenges. Intense competition in the U.S. wireless market could limit pricing flexibility.
The company’s improving operating performance is supporting its earnings and cash flow outlook. Mobility and broadband service revenues increased 2.8% year over year, while adjusted EBITDA reached a record $13.7 billion and adjusted earnings rose 6.6% to $1.3 per share. Free cash flow increased 24.4% year over year during the quarter, prompting management to raise its full-year 2026 adjusted EPS growth and free cash flow growth outlooks to 6-7% and 9-10%, respectively. Beyond its core operations, Verizon is pursuing additional opportunities in AI infrastructure, including a dark-fiber agreement worth more than $1 billion to support Google’s AI data centers.
The Case for ASTS
AST SpaceMobile is pursuing a transformative opportunity in satellite-enabled cellular connectivity. Its large phased-array satellites are designed to connect directly with conventional smartphones, potentially extending coverage to remote areas and locations beyond the reach of terrestrial networks. The company has expanded its in-orbit constellation to 13 satellites and plans to reach about 45 by early 2027. Its commercial ecosystem is also growing: AST SpaceMobile has partnerships with more than 60 mobile network operators representing over 3 billion subscribers.
A second-quarter revenue backlog of approximately $1.3 billion, supported by commercial agreements and U.S. government awards, provides a foundation for its planned expansion. The company also reiterated its full-year 2026 revenue guidance of $150-$200 million, while regulatory progress and international partnerships could broaden its addressable market.
Despite these opportunities, AST SpaceMobile faces substantial execution and financial risks. Satellite deployment depends on successful launches, manufacturing capacity and complex network integration. The company recorded a $125.9 million loss on involuntary conversion in the second quarter of 2026. Competitive intensity could pose a significant challenge for AST SpaceMobile as SpaceX (SPCX - Free Report) expands its Starlink Mobile business. SpaceX is already providing satellite-to-mobile connectivity through partnerships with wireless operators. The company is developing next-generation satellites designed to deliver greater network capacity and broadband connectivity directly to smartphones.
Furthermore, AST SpaceMobile remains unprofitable. It reported a GAAP net loss of $230.9 million in the second quarter, while total operating expenses climbed to $329.1 million. Although its liquidity position improved following additional financing, continued satellite production and launch activity will require substantial capital. Its valuation also leaves limited room for execution setbacks.
How Do Zacks Estimates Compare for VZ & ASTS?
The Zacks Consensus Estimate for Verizon’s 2026 sales and EPS implies year-over-year growth of 2.45% and 5.5%, respectively. The EPS estimate for 2026 has moved northward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AST SpaceMobile’s 2026 sales implies year-over-year growth of 201.7%, while that for EPS suggests growth of 8.8%. The EPS estimate has declined over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of VZ & ASTS
Over the past year, VZ shares have gained 9.2% against ASTS’ decline of 47.6%.
Image Source: Zacks Investment Research
Verizon looks more attractive than AST SpaceMobile from a valuation standpoint. Going by the price/sales ratio, ASTS’ shares currently trade at 32.11 forward sales, significantly higher than 1.27 for VZ.
Image Source: Zacks Investment Research
VZ or AST SpaceMobile: Which is a Better Pick?
VZ and ASTS carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Both Verizon and AST SpaceMobile are pursuing opportunities to expand next-generation connectivity, but Verizon offers a more balanced investment case at present. ASTS has made progress in satellite deployment and mobile operator partnerships, although launch uncertainties, continued losses and a premium valuation remain concerns. Verizon, meanwhile, is benefiting from improving wireless subscriber additions, broadband expansion and stronger cash generation. Its investments in fiber infrastructure and AI connectivity could support future growth. Owing to these factors, Verizon is a better investment option at present.