Verizon is a solid bet in the telecom space, this portfolio manager says

US telecom player Verizon Communications (Verizon Communications Stock Quote, Chart NYSE:VZ) has been an excellent buy-and-hold stock in recent years, thanks to its healthy dividend along with a share price that has been moving upwards. That trend should continue, says Mike Newton of Scotia Wealth, who likes both Verizon and AT&T in the States as well as BCE and Telus in Canada.

“I own BCE, Telus and Verizon and I just added AT&T in the market correction, as well. Verizon is still the premier network in the United States and it’s still a great dividend yield,” says Newton, director and portfolio manager for Scotia Wealth, to BNN Bloomberg on Tuesday.

“There’s a lot of conversation about how they can keep up in this competitive world, about how many more people can they add to their network. I would argue that Bell, Telus, Verizon and AT&T are going to continue doing a great job at that,” he says.

Ahead of Verizon’s launch this week of its first 5G cellphone in the US, the Samsung Galaxy S10 5G, which will soon be available through AT&T, Sprint and T-Mobile as well, Verizon says that the roll-out of 5G will keep going with 20 more markets in the United States later this year, following on a debut in Chicago and Minneapolis last month.

Verizon delivered mixed results in its first quarter earnings report at the end of April, coming in with revenue of $32.1 billion, a hair lower than analysts’ estimates at $32.15 billion. The company’s profits were solid, however, at $5.16 billion in net income and EPS of $1.22 per share compared to the consensus estimate of $1.17 per share. (All figures in US dollars.) The company came out strong in its wireless segment, which in its Q1 grew by 3.7 per cent from a year earlier, while management raised its earnings guidance for the rest of 2019, pointing to customer wins as a driving force.

“2019 is shaping up to be an exciting year for Verizon. We are leading the world in the development of new technologies with the launch of our 5G Ultra Wideband network,” said Chairman and CEO Hans Vestberg, in a press release. “Our ambition remains unchanged to provide the most advanced next-generation networks in the world.”

Verizon’s share price has tailed off since a recent high of $61.19 set in late March and sits in the low $56.00 range as of early trading on Wednesday. Year-to-date, VZ is dead even while over the past 12 months the stock is up an impressive 18 per cent. Verizon’s dividend yield is currently at 4.25 per cent.