By Victor Mora
Verizon Communications Inc. (NYSE:VZ) is a global leader in delivering broadband and telecommunications services to customers, businesses, and government. Today, the bellwether announced strong growth in cash flow, wireless, and FiOS but were held back by a one-time charge for a pension settlement.
Earnings: Verizon earned $881 million ( $0.31 per share) in the third quarter. This is a decrease from last year’s $1.176 million ( $0.41 per share) in the third quarter. Excluding the pension settlement and other charges, adjusted earnings are $0.56 per share this quarter.
Revenue: Decreased 3% to $26.5 billion from $27.3 billion a year ago. Revenue a year ago included landline operations sold to Frontier Communications Corp (NYSE:FTR). Excluding the sale, revenue from the third quarter of 2009 would have been $25.9 billion.
Actual versus Wall Street Expectations: Verizon’s adjusted earnings per share of $0.56 beat estimates of $0.54 per share. Revenue, at $26.5 billion, beat analyst expectations of $26.3 billion.
- Customers paid and average of $18.61 per month for data, up 19% from the previous year.
- Added 226,000 FiOS Internet and 204,000 FiOS TV customers.
- Added 584,000 new wireless customers on monthly contracts.
- Landline business posted operating income of $19 million for the quarter, just breaking even, compared to $4.9 billion on the wireless side.
Did You Hear That?
Chairman and CEO Ivan Seidenberg said:
We are building momentum and are on track to achieve our goal of growing earnings in the second half of the year. We are excited by the opportunities we see to expand wireline margins and the growth we see related to the upcoming launch of next-generation wireless services.
Commentary: Verizon is currently above its 50 DMA and 200 DMA, but is down $0.45 or 1.38%. Verizon, a Dow 30 component, has been in the $26 to $35 range for the last 2 years and does sport a juicy dividend yield of 6%, an eye-catcher for the risk-averse.
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Disclosure: No position