Think It's Too Late to Buy Verizon? Here's the Biggest Reason Why There's Still Time.

Core Viewpoint - Verizon has shown strong performance with a 33% increase in shares since late 2023, outperforming the S&P 500's 20% rally, indicating potential for continued investment opportunities [1] Group 1: Investment Strategy - Verizon has heavily invested in 5G and fiber networks to compete with rivals, which initially raised concerns about its balance sheet and dividend sustainability due to increased leverage [2] - The investments have started yielding results, with over 1 million new postpaid mobile and broadband subscribers added in Q4, marking the best quarterly performance in over a decade [3] Group 2: Financial Performance - Verizon's profitability and free cash flow have improved as capital spending declined, allowing for significant excess free cash flow after dividends, which has been used to reduce debt, lowering leverage from 2.6x in 2023 to 2.3x [3] - The company anticipates continued growth into 2025 and beyond, with capital investments expected to drive organic revenue and earnings growth [4] Group 3: Valuation and Future Potential - Verizon is pursuing a $20 billion all-cash acquisition of Frontier Communications to expand its fiber network, indicating strategic growth initiatives [4] - Despite the stock price rally, Verizon trades at less than 10 times its forward P/E ratio, representing a more than 50% discount compared to the S&P 500, making it an attractive investment opportunity [4][5]