AT&T vs Verizon Which Is Stronger?

AT&T and Verizon are two of the largest telecommunications companies in the United States. Both companies have a long history of providing a range of services, including wireless, internet, and television. Investors often compare the two companies' stocks, analyzing factors such as revenue growth, profitability, and dividend yields. AT&T has a higher dividend yield, while Verizon has shown stronger revenue growth in recent years. Understanding the strengths and weaknesses of each company is crucial for investors looking to make informed decisions in the telecommunications sector.

AT&T or Verizon?

When comparing AT&T and Verizon, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between AT&T and Verizon.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. AT&T has a dividend yield of 4.75%, while Verizon has a dividend yield of 6.31%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. AT&T reports a 5-year dividend growth of -11.11% year and a payout ratio of 90.45%. On the other hand, Verizon reports a 5-year dividend growth of 2.02% year and a payout ratio of 114.26%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with AT&T P/E ratio at 18.59 and Verizon's P/E ratio at 18.25. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. AT&T P/B ratio is 1.64 while Verizon's P/B ratio is 1.86.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, AT&T has seen a 5-year revenue growth of -0.32%, while Verizon's is 0.00%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with AT&T's ROE at 8.72% and Verizon's ROE at 10.33%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $23.34 for AT&T and $42.16 for Verizon. Over the past year, AT&T's prices ranged from $15.94 to $24.03, with a yearly change of 50.75%. Verizon's prices fluctuated between $36.46 and $45.36, with a yearly change of 24.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.