- Verizon (VZ -0.9%) is going to stay clear of major M&A, but will keep its eye on strategic options, and wants investors to start thinking of it as a "GDP-plus" type of growth company.
- That's some of the takeaways from the company's meeting with analysts at its headquarters late yesterday. After some flat service revenues in its Q3 earnings, the company had signaled that ads and data would be its next growth engine.
- That strategy includes its Go90 video service and "Internet of Things" revenue that's hit $500M this year with more investment coming from Verizon. The company said it expects new initiatives to contribute to GDP-plus revenue growth in 3-5 years. "Verizon is positioned to be the FedEx of the digital age," says Verizon chief Lowell McAdam.
- While other companies pursue tie-ups to catch up to a global move towards "quad-play" bundles (wireline, wireless, TV, broadband), McAdam questioned that, said BTIG's Walt Piecyk: "I have not seen any new info on this for 10 years."
- "Management was candid that behind its decisions is a recognition that it needs to disrupt its own business before someone else does and that it is moving to deploy assets to better meet the needs of millennials, which it noted are expected to account for 60% of the purchasing power in the U.S. by 2020," said Cowen's Colby Synesael, who says it's "hard to identify any near-term catalysts" to drive the stock.
- Shares are up 3.7% since earnings on Oct. 20.