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I'm reiterating my Buy rating for Verizon (NYSE: VZ), first recommended on February 12, 2009 at a price of $29.86. Verizon has born the brunt of the recession and related credit shocks well. Further, while VZ's landline business will continue to be pressured by wireless, cable, and Internet phone services, FiOS will prevent some of that attrition. Meanwhile, VZ's dividend is rock solid and it has ample cash.
And, as noted, Verizon boasts a large, moneyed customer base, and dominate positions in key markets. Underscoring, this is not a market for 'experimental' business models, which increases the appeal of VZ. The First Call FY2009/FY2010 EPS estimates for VZ are $2.53 to $2.67.
Stock Analysis: Verizon a low-risk stock. If you already purchased Verizon's shares, hold them. Verizon is an investment, not a trade. If you haven't purchased VZ, consider buying a 25% position in VZ now; then buy another 25% in three months, if U.S. economic conditions don't worsen substantially. Under any circumstance, don't buy more than 50% of your VZ position before October 2009. Sell/Stop Loss if you were to buy shares in this company: $18.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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