Verizon Profits Move Higher
Telecom provider Verizon Communications, Inc. (NYSE: VZ – $50.80) reported second quarter adjusted earnings per share of $0.91, a penny better than the analyst consensus. Revenue was $31.5 billion, ahead of expectations of $31.0 billion. Breaking down its results in the wireless business: Verizon added 1.4 million net retail connections; low retail postpaid churn (defections) of 0.94%; 104.6 million total retail connections; 5.9% year-over-year increase in service revenues including a 5.3% year-over-year increase in retail service revenues and a 32.5 percent operating income margin; In the company’s wireline segment, which consists of landline phone, Internet and television services, the company recorded a 5.3% year-over-year increase in consumer revenues, the eighth consecutive quarter of more than 4% growth; consumer ARPU (average revenue per user) up 11.0% and 14.4 percent year-over-year increase in FiOS revenues with 139,000 FiOS Internet and 100,000 FiOS Video net additions. All-in-all it was a decent quarter for Verizon. With a yield of 4.2% and worthwhile growth prospects, the shares merit retention in a well-diversified income portfolio.