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Investing.com - JPMorgan has raised its price target on Verizon Communications (NYSE:VZ) to $49.00 from $47.00 while maintaining a Neutral rating on the stock, citing the company’s focus on profitability over subscriber growth. The telecommunications giant, currently trading at a P/E ratio of 9.5x and offering a substantial 6.4% dividend yield, is showing signs of being undervalued according to InvestingPro analysis.
The revised price target comes after Verizon CFO Tony Skiadas emphasized that the company aims to improve volumes year-over-year, but not at the expense of delivering on key financial priorities. JPMorgan noted that Verizon is prioritizing EBITDA growth over phone volumes given the competitive landscape and difficult second-half 2025 comparisons. InvestingPro data reveals that Verizon has maintained dividend payments for 42 consecutive years, demonstrating strong financial discipline. Get access to 8 more exclusive ProTips and comprehensive analysis with an InvestingPro subscription.
JPMorgan has adjusted its forecast for Verizon, now expecting flat subscriber numbers in the third quarter with 2025 Consumer phone losses of 50,000, down from its previous projection of 90,000 net additions. The firm also reduced its third-quarter Business phone net add expectations to 55,000 due to continued federal government pressures.
The investment bank raised its 2025 consolidated EBITDA estimate by 0.5% to $50.34 billion, representing 3.2% year-over-year growth, which falls within Verizon’s increased guidance range of 2.5-3.5%. JPMorgan also increased its 2025 free cash flow projection to $19.99 billion, reflecting Verizon’s updated guidance of $19.5-20.5 billion, which benefits from a $1.5-2.0 billion lift from tax reform and higher underlying cash flow from operations. The company’s current EBITDA stands at $49.89 billion, with a healthy free cash flow yield of 11%.
Despite the price target increase, JPMorgan maintained its Neutral stance on Verizon, citing limited near-term catalysts, below-peer multi-year consolidated EBITDA and free cash flow growth, and continued questions about the company’s growth algorithm into 2026. According to InvestingPro’s comprehensive analysis, Verizon maintains a "GOOD" overall financial health score of 2.56, with particularly strong marks in profitability metrics.
In other recent news, Verizon Communications has reported impressive financial results for the second quarter of 2025, surpassing analyst expectations. The company achieved an adjusted earnings per share (EPS) of $1.22, which exceeded the forecast of $1.19, and generated revenue of $34.5 billion, surpassing the projected $33.71 billion. This performance marks a 6.1% increase in EPS and a 5.2% rise in revenue year-over-year. Verizon has also raised its full-year guidance for adjusted EBITDA and EPS growth, reflecting confidence in its strategic direction. Goldman Sachs has maintained its Buy rating on Verizon, with a price target of $52, acknowledging the company’s strong financial metrics and improved business segment performance. The firm noted that wireless trends were better than expected, despite a competitive environment. Verizon’s strategic initiatives, including the expansion of AI and fixed wireless solutions, have contributed to its solid performance. Additionally, the company is in the process of acquiring Frontier, which is anticipated to accelerate its fiber strategy.
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