Verizon Communications (VZ)

Really likes this for the cash flow yield and the story where, if you look at companies and their peers in this space, they are very good at taking the money investors give them and making a return. They were a leader in 4G development and a lot of their competition has caught up, and she bought into the weakness because of their strong history of being the leader. Also, there is a lot of movement in the global telecoms space. If you look at the margins in the US for data, etc., versus those in Europe and other countries, there is some consolidation. Good defensive type stock. 4.3% dividend yield.

This represents an interesting opportunity. The catalyst is really the purchase of the share of the wireless opportunity that Vodafone (VOD-Q) controlled. This was accretive right from the get-go. They are growing their earnings at a fairly good pace in industry that generally does not have rapid growth. Trading at a reasonable multiple. The dividend is a very attractive lure to an entry and this dividend will have growth. With the debt loads that they carry, any increase in interest rates will be a negative to the industry. 4.3% dividend.

(Market Call Minute) Does not like the US wireless space.

One of his favourite telcos in North America. Very attractive dividend yield. One of the things that you always want to look for when you invest in a telecom stock is whether or not they have consistently maintained their network. You are going to see explosive demand for data services for the next few years. The nice thing about this company is that if you look at their capital intensity, it has been fairly consistent. Have a very good network and have a dominant position. Thinks this is going to be a good dividend growth story and a good cash flow growth story.

An attractive stock. The catalyst here is the transaction they did with Vodafone. This company is doing some very interesting things and producing a lot of cash. Pays a very nice dividend. Turnover rate of customers is very low. Debt load of over $100 billion is a worry, and if interest rates rise, interest expense is going to become a bigger issue.

US telecom sector is cheaper than the Canadian one. You are not going to see a tremendous upside in the stocks. They are much more fairly valued, so you are going to get the dividend plus maybe 5%-6% growth in the stock price. This company has some potential good growth opportunities because they now own all the wireless assets. You should get a nice 10% rate of return on this.

There is some scent of higher interest rates and telcos are burdened by a lot of debt due in the next 5 or so years so the market is nervous. They are working very hard to build out the wireless side of their business. The numbers look attractive. Buying out VOD-N was accretive from the get go. There is lots of opportunity, but you have to be aware of interest rates.

Stock vs. Stock: BCE-T vs. VZ-N. They are two different stocks. BCE gives you a fantastic dividend close to 5% and decent cash flow. Telcos in general are getting up there in terms of valuations. VZ-N should provide more growth and less dividend than BCE. It depends what you are trying to accomplish.

They bought back a big chunk of VZ-N stock from VOD-N. It has been tough to get into any company with stable, recurring revenue. Valuations skyrocketed because of this, but VZ-N did a very good job of it. Enjoyed very good growth. She has taken current uncertainty as an entry point and now sees some more good upside on the name.

Since the restructuring of their balance sheet, the Book Value really fell away underneath the company, and left it on a Price-to-Book value, up in nosebleed country.. FMV calculations would be $60 and higher, but when he looks at the risks on a Price-to-Book point of view, they are at levels that he doesn’t like to take.

Telecoms. Seasonality is June until about October. We just broke above a trading range. If you have it, stick with it.

Equal weight on AT&T (T-N), Verizon (VZ-N) and Vodafone (VOD-Q) as a dividend play? If looking for dividend income, why not take advantage of the dividend tax credit that is offered on Canadian dividends? Although you get a dividend on these, from a tax standpoint it is treated as interest. As far as the telcos in the US are concerned, is that they distribute a lot of cash which generally run at the 4%-5% rate. AT&T is a slower grower. Of these 3, his favourite would probably be this one.

Likes the strategy, but prefers VOD stock. Buy VOD on weakness and hold what you have already. VZ’s balance sheet is stretched.

Looks good in everything she looks for. Major issue is T-mobile. It is threatening margins. The cash they generate is compelling.

A good dividend payer. Very little net gain in the actual stock. If you are looking for a nice dividend play, consider ZWU-T, 6% yield and low volatility.