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UPDATE: Bank of America Upgrades Verizon Communications as VOD Deal Overhang Creates Entry Point

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In a report published Monday, Bank of America analyst David W. Barden upgraded the rating on Verizon Communications (NYSE: VZ) from Neutral to Buy, and reiterated the $55.00 price target.

In the report, Bank of America noted, “We are upgrading Verizon to Buy from Neutral on an attractive risk/reward profile, superior fundamental positioning, and potential for post-deal earnings upside. Our price objective of $55 and Verizon's 4.5% dividend yield imply a total return of 21%. VZ now trades at a 5 year low relative PE multiple of 0.86x vs.its 1.15x average. Even referring back to pre-crisis trading '04 to '08, VZ trades at its average of 0.88x. VOD deal-related selling of VZ shares is likely in our view and could drive short-term downside, but looking at pre-crisis valuation lows, we see $43.50 as the downside limit, implying 5% downside net of dividends over a one year holding period in a worst case scenario. On balance, we view this risk/reward tradeoff as attractive.”

Verizon Communications closed on Friday at $47.27.

Latest Ratings for VZ

DateFirmActionFromTo
Nov 2019DowngradesBuyHold
Nov 2019DowngradesBuyNeutral
Oct 2019Initiates Coverage OnMarket Perform

View More Analyst Ratings for VZ
View the Latest Analyst Ratings

Posted-In: Bank of America David W. BardenAnalyst Color Upgrades Analyst Ratings

 

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StockFirmActionPT
STNECantor FitzgeraldMaintains40.0
SPLKSunTrust Robinson HumphreyMaintains175.0
ROSTWells FargoMaintains125.0
SPLKWells FargoMaintains175.0
HMSYGuggenheimUpgrades
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