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Verizon Communications Inc. (NYSE:VZ) – Major Move Impending

Verizon Communications Inc. (NYSE:VZ) opened with a gap down but managed to recover almost all the intraday loss by the end of the session only 0.43% down. The trading session expressed the same mixed sentiment in price as seen in the first quarter results of the company, reported yesterday morning. The revenue estimates weren’t exactly met perfectly though the company beat the consensus bottom line earnings expectations.

The street was expecting Verizon Communications Inc. (NYSE:VZ) to report a top line sales of $32.3 billion and an earnings of $0.95 per share. The company reported $32 billion in earnings, marginally short though an increase of 3.8% on a y-o-y basis can’t be ignored. The EPS came at $1.02, increasing by 21.4%. The cash flows of the company saw an increase of 42% to $10.2 billion and that includes the onetime payment from American Tower Corp (NYSE:AMT) amounting to $2.4 billion. Excluding that payment, the operating cash flow of Verizon Communications Inc. (NYSE:VZ) doesn’t look that strong as it comes down to a growth of 9.9% on a y-o-y basis.


Technically, one must take note of two most important things. Firstly, the stock has been stuck in the range of $46-$54 for more than 2 years. Secondly, the major trend before this sideways phase was up and the series of the long term higher highs and higher lows was not negated even in the last 24 months. There is a minor possibility that the entire rangebound price action has bottomed out at the January 2015 low of $45.37, to be confirmed on a break above $55.

The short term range clearly shows the intense collapse of volatility, which suggests that a trending move is impending and a break above $50 will be bought by the traders for an immediate target of $52.

Published by Chris Brown

About Me: I have a Phd in Economics Gender: Male Interests: Playing games like cricket, volleyball Favorite Music: hip hop, rock, jazz

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