VZ stock falls premarket as Morningstar sees 23% upside
Verizon Communications (VZ) stock slipped 0.37% in Monday premarket after a nearly 6% Friday surge, yet Morningstar still pegs fair value at $54—more than 23% upside. The research firm says the telecom giant remains attractively valued despite tougher competition, citing scale, fiber growth, and a well-covered dividend.
Key Takeaways
- VZ stock fell 0.37% premarket Monday after closing up nearly 6% on Friday.
- Morningstar's $54 fair value estimate implies more than 23% upside from the last close.
- Wireless remains about 75% of Verizon service revenue and nearly all operating income.
- MarketBeat recently noted a Hold consensus near a $50.03 target and a roughly 6.4% dividend yield.
- Risks include regulation, spectrum auctions, rival tech advances, and satellite competition.
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Why did VZ stock fall in premarket trading?
According to a Yahoo Finance report citing StockTwits, shares of Verizon Communications Inc. (VZ) fell 0.37% premarket on Monday. That dip followed a strong Friday session in which the stock closed up nearly 6%.
The move landed against a still constructive 2026 backdrop: VZ stock has gained more than 14% year to date. On StockTwits, retail sentiment was described as bullish amid high message volumes when the report was published.
Why does Morningstar still see more than 23% upside?
Morningstar maintained that Verizon shares remain attractively valued even as competition gets harder. The analyst set a fair value estimate of $54, implying upside of more than 23% from the last close.
The firm kept a Narrow Economic Moat rating and a Medium uncertainty assessment. Morningstar highlighted Verizon as the largest U.S. wireless carrier, with roughly 94 million postpaid and 20 million prepaid phone customers.
Wireless operations generate about 75% of service revenue and almost all operating income. The Frontier Communications acquisition also expanded Verizon's fiber footprint and its ability to bundle broadband with wireless.
Morningstar expects wireless service revenue to stay broadly flat in 2026, then grow about 2% annually over five years and accelerate to roughly 3% in 2028 as customers migrate to newer plans. It also said Verizon holds roughly 35% of the U.S. postpaid phone market—about 10% more customers than T-Mobile and 25% more than AT&T—supporting industry-leading margins and returns on capital.
The report called the dividend yield "fantastic," noting the payout consumes less than 60% of free cash flow. Separately, MarketBeat reported a recent quarterly dividend of $0.7075 per share, or about a 6.4% annualized yield, alongside a Hold consensus and an approximate $50.03 target price.
What risks could still pressure the stock?
Morningstar flagged regulatory risks, future spectrum auctions, and technological advances that could strengthen rivals such as AT&T, T-Mobile, Comcast, and Charter. It also pointed to competition from satellite technology companies like SpaceX.
Those caveats help explain why a mild premarket pullback can still grab headlines even when a major research house sees double-digit upside. Investors watching income names may focus on cash-flow coverage and wireless share trends as much as day-to-day price swings.