AT&T Inc. (T), Verizon Communications Inc. (V)…What’s Going on in the Telecom Industry?

In a statement, Verizon Communications Inc. (NYSE:VZ) has denied that it is working on any deal with AT&T Inc. (NYSE:T). The company maintained that it’s still interested in buying out Vodafone’s 45% stake in Verizon. According to Verizon, it does not, however, “currently have any intention to merge with or make an offer for Vodafone, whether alone or in conjunction with others.”

Bottom line

The rumor of this major deal boosted Vodafone’s share price by approximately 3% but the retraction recently pressured the stock by 1.5%. I don’t believe this is the end of a possible acquisition of Vodafone and I believe that Verizon will continue to try and buyback its 45% share.

The telecom industry is rapidly changing, and data holds the future to carrier success. The companies with the best 4G networks will definitely become more attractive for subscribers. Verizon Communications Inc. (NYSE:VZ) currently leads the 4G revolution, making it the best long-term bet in the telecom sector.

Moreover, carriers are trying to wrest some of their lost dominance over this space by backing the new Research In Motion Ltd (NASDAQ:BBRY) and Microsoft Corporation (NASDAQ:MSFT) Windows Phone ecosystems. The BB10 and Windows 8 devices have received modest consumer interest so far but it’s still too soon to rule them out of the game.

We are looking at consolidation in the telecom space and Vodafone is an attractive takeover target. The takeover rumors have been denied for the time being but I believe the acquisition possibility is strong and that makes Vodafone an attractive investment.