Tomahawk, WI 04/14/2014 (Basicsmedia) – Verizon Communications Inc. (NYSE:VZ) is better placed than its competitors in the telecom business. ALL players in the telecom business including AT&T Inc. (NYSE:T) and T-Mobile US Inc (NYSE:TMUS) are better placed than airlines or automobile manufacturers.

As far as different sectors of the economy go, wireless carriers and the telecommunications sector in general may have acquired more competitors than before and the AT&T monopoly may be over but the competition is not nearly as cut-throat as in airlines or automobiles. There are not many bankruptcy filings (like in the airlines or the automotive industry) or price wars that hurt everybody.

Verizon M&A Activity

Verizon Communications Inc. (NYSE:VZ) paid $130 billion to Vodafone Group Plc (ADR) (NASDAQ:VOD) to buy out Vodafone’s 45% stake in Verizon Wireless.

Verizon will be acquiring wireless assets, spectrum and up to 3,40,000 customers from Cincinnati Bell (NYSE: CBB).

Positive Financial Outlook And More

While the Verizon stock has been anemic since the beginning of 2014 and has fallen by about 2%, the company has a pretty solid financial footing and the 1Q2014 results to be declared on April 24 might lead to the beginning of a rally. With the buy-out of Vodafone’s stake in Verizon Wireless completed, Verizon will obviously get better margins.

Verizon Communications Inc. (NYSE:VZ) also saw strong growth in its cash flow. Operating cash flow was up by 23% in the last quarter while free cash flow amounted to $22.2 billion, which was a rise of 45% YoY. With $43.13 billion in cash on hand, Verizon is good-to-go as far as paying dividends is concerned.

Verizon has also seen strong growth in customer numbers in the last fiscal spanning postpaid connections and 4G LTE connections.

It’s The Data Stupid

With the best 4G LTE network in the country, it is poised to reap dividends from the expected growth in mobile data traffic which is expected to grown from 2 exabytes per month in 2013 to around 16 exabytes a month in 2018. 4G will make up 51% of that data by 208 and if Verizon is able to maintain its technology leadership, it will reap dividends.

T-Mobile Challenge

Verizon Communications Inc. (NYSE:VZ) continues to face competition from smaller competitors such as T-Mobile that is trying to disrupt the status quo. It has recently launched a $40 starter plan for cost-conscious phone users. Vodafone responds to this cut-price competition by announcing discounting of its own.

Price Target

Price target for the Verizon Communications Inc. (NYSE:VZ) stock remains at around $54 to $55 per most analysts with some going as far as $59.

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