AT&T vs. Verizon: Which Is The Better Investment?
The telecommunications industry is one of the most profitable markets in the world and the leaders in that market have long proven themselves to be solid stock investments. Two of those leaders are AT&T (NYSE: T) and Verizon (NYSE: VZ) and while both are fantastic stock picks relative to the rest of the top companies in the industry, when you compare them side-by-side with one another you are likely to find one to be a clear winner over the other. Which one that is depends on your own analysis (and maybe your personal service provider too) but we’ll try to help give you some solid information on both so you can decide Who Would You Rather…AT&T or Verizon?
Both stocks have had a very active 2013 with AT&T seeing its highest numbers in February, March, and April and Verizon seeing their around the same time in April, May, and June. AT&T saw an increase in shares of about 15% throughout that three month period while Verizon’s shares rose roughly 12% during their best three months. That being said, conventional wisdom (and a simple check of the number) would tell you that AT&T is probably the better stock. But Verizon has been the overall leading company in the market for the last several years and still is. So does it stand to reason that Verizon is the better stock even though AT&T has had a better year in 2013? Not necessarily.
Verizon has spent the last 18 months putting together a number of partnerships, their most prominent arguably being with Comcast (NASDAQ: CMCSA). Verizon has been heading up sales of Comcast’s cable TV and broadband division and Comcast has been selling Verizon’s wireless products and services. In so doing, both companies have established a loyal customer base that they might not have had the partnership not been in place. Though the partnership was terminated in October 2013, it seems both companies reaped benefits from the mock-merger. With customer numbers being as high as they are as a result of Verizon’s partnerships with Comcast and other strong companies like Time Warner Cable (NYSE: TWC) they continue to build a strong case as the better stock.
Then there is the issue of mobile web service. Back in the summer of 2012 Verizon began offering customers 4G LTE wireless connectivity in more than 300 markets while AT&T was offering it in fewer than 40. It wasn’t long before AT&T got on their horse and started offering their 4G LTE service in more markets but by the time they did Verizon had increased its market share as well and the gap has stayed largely the same ever since. They tried to make up the difference by offering the 4G HSPA+ connectivity in other markets as opposed to the LTE service but that actually ended up doing more harm than good since HSPA+ is a slower technology than the LTE.
It is difficult to look at the numbers and not seem a little bit biased in favor of Verizon. After all, they have been leading the industry for a number of years now and AT&T just cannot seem to keep up. But at the end of the day we can’t tell you which is the better stock to buy. Or more precisely, we shouldn’t tell you. Only you can decide which of these stocks you would rather add to your portfolio. But hopefully we’ve pointed you in a clear direction.
Verizon spent the last 18 months putting together a number of partnerships, their most prominent arguably being with Comcast. Verizon has been heading up sales of Comcast's cable TV and broadband division, and Comcast has been selling Verizon's wireless products and services. In so doing, both companies have established a loyal customer base that they might not have had the partnership not been in place.
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