Verizon Communications Inc. (NYSE:VZ) is in the spotlight today courtesy of a Bloomberg article. According to the column, the telecommunications giant has been working to secure streaming rights from various TV network owners in preparation for launching its own online TV service potentially this summer. The online TV package will likely include dozens of channels and would be independent of Verizon’s FiOS offering. Although most Americans still get their daily dose of TV through actual televisions, data shows that 2 million consumers are subscribed to TV delivered through the net, and that number could grow as cord cutting becomes more common and more viable options hit the market. For Verizon Communications Inc. (NYSE:VZ), the company’s online TV product could be an opportunity/hedge against the secular decline of cable.
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Of the 742 elite funds we track, 55 funds owned $2.3 billion of Verizon Communications Inc. (NYSE:VZ) and accounted for 1.10% of the float on December 31, versus 54 funds and $3.18 billion respectively on September 30. Steve Cohen‘s Point72 Asset Management initiated a new stake of 2.8 million shares in the fourth quarter.
The Bottom Line
With its purchase of Yahoo and now the online TV service (if true), Verizon Communications Inc. (NYSE:VZ) is diversifying further from its telecommunications roots. Although the new ventures won’t be easy, they will, if successful, help increase the safety of Verizon’s already attractive dividend, which currently sports a 4.7% yield at current prices. For those of you interested, check out this article about apps that made millions of dollars.