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Verizon Communications (VZ) Gains But Lags Market: What You Should Know

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Verizon Communications (VZ - Free Report) closed at $61.37 in the latest trading session, marking a +0.26% move from the prior day. This change lagged the S&P 500's 0.3% gain on the day. At the same time, the Dow added 0.27%, and the tech-heavy Nasdaq gained 0.3%.

Prior to today's trading, shares of the largest U.S. cellphone carrier had gained 2.08% over the past month. This has lagged the Computer and Technology sector's gain of 3.51% and the S&P 500's gain of 2.69% in that time.

VZ will be looking to display strength as it nears its next earnings release, which is expected to be January 30, 2020. On that day, VZ is projected to report earnings of $1.24 per share, which would represent year-over-year growth of 10.71%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $34.43 billion, up 0.45% from the year-ago period.

It is also important to note the recent changes to analyst estimates for VZ. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.14% lower. VZ is currently a Zacks Rank #3 (Hold).

Looking at its valuation, VZ is holding a Forward P/E ratio of 12.68. This represents a discount compared to its industry's average Forward P/E of 14.95.

Meanwhile, VZ's PEG ratio is currently 3.94. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Wireless National was holding an average PEG ratio of 3.21 at yesterday's closing price.

The Wireless National industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 99, putting it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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