Let’s dig into the relative performance of Verizon (NYSE: VZ) and its peers as we unravel the now-completed Q1 wireless, cable and satellite earnings season.
The massive physical footprints of cell phone towers, fiber in the ground, or satellites in space make it challenging for companies in this industry to adjust to shifting consumer habits. Over the last decade-plus, consumers have ‘cut the cord’ to their landlines and traditional cable subscriptions in favor of wireless communications and streaming video. These trends do mean that more households need cell phone plans and high-speed internet. Companies that successfully serve customers can enjoy high retention rates and pricing power since the options for mobile and internet connectivity in any geography are usually limited.
The 8 wireless, cable and satellite stocks we track reported a mixed Q1. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 1% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Verizon (NYSE: VZ)
Formed in 1984 as Bell Atlantic after the breakup of Bell System into seven companies, Verizon (NYSE: VZ) is a telecom giant providing a range of communications and internet services.
Verizon reported revenues of $33.49 billion, up 1.5% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ EPS estimates.
Interestingly, the stock is up 1.6% since reporting and currently trades at $43.63.
Is now the time to buy Verizon? Access our full analysis of the earnings results here, it’s free.
Best Q1: Comcast (NASDAQ: CMCSA)
Formerly known as American Cable Systems, Comcast (NASDAQ: CMCSA) is a multinational telecommunications company offering a wide range of services.
Comcast reported revenues of $29.89 billion, flat year on year, in line with analysts’ expectations. The business had a satisfactory quarter with a decent beat of analysts’ EPS estimates but a miss of analysts’ domestic broadband customers estimates.
However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $34.44.
Is now the time to buy Comcast? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Altice (NYSE: ATUS)
Based in Long Island City, Altice USA (NYSE: ATUS) is a telecommunications company offering cable, internet, telephone, and television services across the United States.
Altice reported revenues of $2.15 billion, down 4.4% year on year, in line with analysts’ expectations. It was a slower quarter as it posted a miss of analysts’ EPS and adjusted operating income estimates.
Interestingly, the stock is up 4.2% since the results and currently trades at $2.75.
Read our full analysis of Altice’s results here.
WideOpenWest (NYSE: WOW)
Initially started in Denver as a cable television provider, WideOpenWest (NYSE: WOW) provides high-speed internet, cable, and telephone services to the Midwest and Southeast regions of the U.S.
WideOpenWest reported revenues of $150 million, down 7.1% year on year. This result beat analysts’ expectations by 1.3%. Zooming out, it was a mixed quarter as it also logged an impressive beat of analysts’ adjusted operating income estimates but a miss of analysts’ EBITDA estimates.
WideOpenWest pulled off the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is flat since reporting and currently trades at $4.37.
Read our full, actionable report on WideOpenWest here, it’s free.
AT&T (NYSE: T)
Founded by Alexander Graham Bell, AT&T (NYSE: T) is a multinational telecomm conglomerate providing a range of communications and internet services.
AT&T reported revenues of $30.63 billion, up 2% year on year. This print surpassed analysts’ expectations by 1%. Aside from that, it was a mixed quarter as it also produced a decent beat of analysts’ adjusted operating income estimates but EPS in line with analysts’ estimates.
AT&T delivered the fastest revenue growth among its peers. The stock is up 3.3% since reporting and currently trades at $27.85.
Read our full, actionable report on AT&T here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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