Last Friday Verizon Communications Inc (VZ) revised down its full-year earnings forecast, as it gained fewer monthly phone subscribers than anticipated during the second quarter.
The wireless carrier added just 12,000 net phone subscribers who pay a monthly bill, compared with a FactSet forecast of 150,800, as red-hot inflation in the US has made customers more cost-conscious.
In June, Verizon raised prices for its plans and warned last week it might need to increase them again if costs keep rising.
Verizon now expects full-year adjusted earnings per share within the range of $5.10 to $5.25, a revision down from the previously forecast range of $5.40 to $5.55 per share.
According to Matt Ellis, Verizon’s CFO, higher level of promotional activities aimed to increase subscriber additions is another reason to revise down profit forecast.
Verizon shares closed lower for a third consecutive trading session in New York on Friday. It has also been the steepest single-session loss in more than 5 years. The stock went down 6.74% ($3.21) to $44.45, after touching an intraday low at $43.77. The latter has been a price level not seen since July 24th 2017 ($43.68).
The shares of Verizon Communications Inc have retreated 14.45% so far in 2022 compared with a 16.88% loss for the benchmark index, S&P 500 (SPX).
In 2021, Verizon Communications Inc’s stock went down 11.56%, thus, it underperformed the S&P 500, which registered a 26.89% gain.
Analyst stock price forecast and recommendation
According to TipRanks, at least 12 out of 15 surveyed investment analysts had rated Verizon Communications Inc’s stock as “Hold”, while 2 – as “Buy”. The median price target on the stock stands at $55.08.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
