Verizon Trading Down Following Earnings

| About: Verizon Communications (VZ)

Verizon (NYSE:VZ) this morning reported revenue for the third quarter of $23.3 billion, a bit ahead of Street expectations of $23.03 billion, and per-share profits of 66 cents a share, or 68 cents before special items.

The report includes 4 cents a share from discontinued operations; without that, the number is 62 cents; there is also a tax-related gain of $85 million, or about three cents a share. To tell you the truth, it’s a little confusing. The Street had been expecting 66 cents; so the quarter looks good on the 68 cent number, but less good if the analysts weren’t including the 4 cents from discontinued operations.

In a note this morning, Bernstein Research analyst Jeff Halpern notes that wireless net customer additions were higher than expected, at 1.9 million, versus 1.6 million consensus. He notes that EBITDA was also higher than expected - the reported $8.26 billion compares to his estimate of $7.9 billion. Access lines declined 7.5% from a year earlier, about in line with his expectations. Halpern notes that the company did not provide any guidance on future performance. Says Halpern: “We continue to see Verizon as an attractive investment, though one approaching full valuation on earnings but with significant cash flow growth coming in the coming years supporting upside to the current share price.”

Verizon shares this morning are down $1.14 at $37.70.