Verizon Just Signed Its Second Google Deal. Is the Stock Still a Buy Near Its High?
Verizon (VZ) closed at $50.15, up 23% YTD, near its 52-week high. The company announced an expanded AI partnership with Google Cloud, adding to a $1B dark-fiber deal. Q2 showed record EBITDA margins and raised guidance. Analysts' target prices range up to $71, with a mid-case target of $69, implying ~37% total return. Verizon trades at 9.9x NTM P/E, with a 5.7% dividend yield.
How this was made
The 30-second read
Why it matters
The new Google Cloud AI deal adds a strategic growth pillar beyond traditional telecom services.
Market read
The announcement could lift Verizon shares and influence telecom sector sentiment.
What to watch
High leverage and competitive pressure on wireless pricing could limit upside.
Background
Verizon has been improving margins and reducing churn, with a $9 bn cost‑saving program for 2024.
Ticker impact
Verizon announced a new AI partnership with Google Cloud on August 24, adding a revenue stream and cost savings.
Potential upside toward $69 target over the next few years.
The partnership introduces a new growth vector and $9 bn cost program, improving earnings outlook.
Market effects
Highlights growing telecom‑cloud collaborations, may pressure peers AT&T and Deutsche Telekom.
U.S. telecom sector could see modest re‑rating as AI services expand.
Signals broader trend of carriers partnering with cloud providers worldwide.
Counterpoint
If AI Connect revenue ramps slower than expected, the partnership could be a costly distraction.
Key entities
- CompanyVerizon Communications Inc.
U.S. telecom operator
- CompanyGoogle Cloud
Alphabet's cloud services division
