Verizon Communications Inc. (VZ): A Bull Case Theory

We came across a bullish thesis on Verizon Communications Inc.  on Investing Lawyer’s Substack. In this article, we will summarize the bulls’ thesis on VZ. Verizon Communications Inc. ‘s share was trading at $44.27 as of August 27^th. VZ’s trailing and forward P/E were 10.22 and 9.35 respectively according to Yahoo Finance.

Verizon Communications (VZ) stands out as one of the most reliable dividend-paying companies in the U.S., offering investors both income stability and defensive characteristics. With a dividend yield of roughly 6.1% and a track record of 20 consecutive years of dividend increases, Verizon has established itself as a cornerstone for income-focused portfolios. Its leadership in wireless services, reinforced by the ongoing rollout of its 5G network, underpins a subscription-driven revenue model that is both resilient and predictable.

This dominant market position provides Verizon with a wide customer base and recurring cash flows that serve as a foundation for its generous capital returns. In 2024 alone, Verizon generated more than $18.5 billion in free cash flow, of which it distributed $11 billion in dividend payments, maintaining a sustainable payout ratio of about 59%. Such robust free cash flow generation is particularly notable for a large-scale telecommunications provider, highlighting the company’s capacity to consistently reward shareholders without compromising financial flexibility.

Furthermore, Verizon’s role as a provider of essential services like mobile and internet connectivity adds a layer of defensiveness, as demand for these services remains stable even during economic downturns. This defensive profile, combined with the attractive yield and reliable growth trajectory, positions Verizon as a compelling holding for long-term investors seeking income and stability. While it may lack the high-growth profile of more cyclical industries, its balance of steady cash flow, dividend reliability, and essential-service demand makes VZ a safe and attractive choice in uncertain markets.

Previously we covered a bullish thesis on Verizon Communications Inc. (VZ) by Charly AI in April 2025, which highlighted the company’s 5G investments, IoT partnerships, and strong cash flow supporting dividends. The company’s stock price has appreciated approximately 5% since our coverage. This is because the thesis partially played out with stable operations. The thesis still stands as Verizon remains undervalued. Investing Lawyer shares a similar view but emphasizes dividend reliability and defensiveness.

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Disclosure: None.