Verizon Communications Inc. (VZ - Free Report) recently announced that it has been selected by SAP SE (SAP - Free Report) to build the latter’s next-generation global network infrastructure. SAP is a Germany-based multinational software corporation that makes enterprise software to manage business operations and customer relations.
SAP is planning to have a secure platform to improve support for customer-facing applications and provide a better user experience to its employees and customers. To that end, Verizon will integrate SAP’s global network infrastructure for easier and more cost-effective network management. Verizon’s innovative network solutions will help SAP to build a future-ready infrastructure that will support exponential growth of its cloud business.
In the past, SAP’s in-house team maintained its global IT real estate holdings with a number of vendors to provide services. Owing to the significant growth of its cloud business, SAP decided to consolidate management of its global network environment using next-generation network technologies. The new approach, driven by SAP’s increasing reliance on the cloud, is to have an outsider create the network and thus free its workforce for customer-centric jobs.
Verizon was selected due to its global reach, secure and high capacity global network capabilities. It will consolidate management of SAP’s global network. Verizon was a previous technology partner of SAP. The company is now working with SAP in two key projects. First, it is developing a new global network to link SAP’s offices around the world, which includes voice and data services. Second, Verizon is providing scalable and secure Internet connectivity to connect SAP’s customer-facing data centers around the globe.
Verizon has an attractive fundamental outlook based on increasingly favorable growth prospects for its Wireless business. The company is seeking mobile hotspot and home-based fixed wireless for initial deployment of the next-generation 5G wireless networks in the United States in 2018.
Over the past three months, the stock has returned 13.4% compared with 10.6% growth for the industry.
Verizon currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the industry include United States Cellular Corp. (USM - Free Report) , sporting a Zacks Rank #1 (Strong Buy) and AT&T Inc. (T - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
United States Cellular has a long-term earnings growth expectation of 1%. It surpassed earnings estimates thrice in the trailing four quarters with an average positive surprise of 303.6%.
AT&T has a long-term earnings growth expectation of 3.6%. It surpassed earnings estimates twice in the trailing four quarters with an average positive surprise of 5.9%.
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