ThinkQue Consultants

Investor Analysis
Verizon Communications Inc
Submitted To:

Prof. Giacomo Mengucci

Date: 28 November 2022

November 28, 2022
Fraser Valley India
Goswami Ganesh Dutta S.D. College Sector 32-C,
Chandigarh 160030

Dear investors,
In order to help you evaluate Verizon Communications Inc. as
an investment, we have prepared a reply. From the favour you
have sought, this study includes comprehensive explanations
and we are certain that our research will assist you to make a committed choice on whether
or not you will invest in Verizon Communications.

Our consulting firm has examined a variety of trustworthy sources to get you the
information required to assist you understand where Verizon is positioned and where it is
heading for the future. In light of the above, we hope that the detailed information provided
in this paper, which covers the company's history, current state, and future prospects, will
help you make an informed choice about your financial prospects.
In this research, we analyse the external and internal variables that have a significant impact
on Verizon's decision-making, including the company's vulnerability to external factors (as
measured by the PESTEL analysis) and the opportunities it presents (as measured by the
SWOT analysis).

While the primary goal of this document was to provide you with a recommendation to
invest in Verizon, it has also provided our consulting firm with valuable insight into the
internal workings of large corporations, including how to locate reliable sources that not
only support individual member's ideas but also provide context and a summary of the
group's collective work.

Our firm hopes that this study has been comprehensive, informative, and objective in
helping you make this important choice. If we missed something or you would want
additional information, please feel free to contact us as we are always here to assist you
with critical choices.

Sincerely,
ThinkQue Consulting Company

PALKIT SIDHU MANDEEP KAUR SANIKA RAHUL GARG

--------------------- ---------------------- ---------------------- ------------------------
PRESIDENT MEMBER MEMBER MEMBER
 Executive Summary
On June 30, 2000, the largest corporate merger in American history took place, creating
what is now known as Verizon Communications from the merging of Bell Atlantic Corp. and
GTE corp. Innovative forms of communication and technological backing have had a
profound effect on the relationships between people, places, and things.
Verizon's focus to future-proof infrastructure projects like the 5G Network and the 4G LTE
has given the company a significant research-and-development (R&D) advantage. When it
comes to the quality of their network and their overall market share, Verizon is far and away
the best option for Americans. In 2017, Verizon's reputation took a knock when the FCC
found that the firm had exposed the personal details of over 6 million subscribers. There
may be many opportunities for the business if it expands into other countries. Like
Vodafone, Verizon has to concentrate on the rapidly growing Asian regions if it wants to
develop more rapidly. AT&T and T-Mobile are two of Verizon's main rivals in the United
States.
According to its mission statement, Verizon's goal is to "deliver, inspire, and train to
empower the future via education" by helping "people, organizations, and society" become
more innovative and charitable.
The company's internal structure is largely responsible for Verizon's success. In terms of
structure, it has opted for functionality. It provides its employees with a number of perks,
such as adoption assistance, a 401(k) with company matching, health insurance, and paid
vacation time, among others. Verizon's leadership is always on the lookout for ways to
innovate the company's current goods and develop novel approaches to meeting the ever-
shifting needs of the company's consumers. Hans Vestberg is chairman and chief executive
officer of Verizon. Under Vestberg's leadership, Verizon inked a $700 million deal with the
Indian firm Infosys to outsource a substantial chunk of its information technology
operations.
The Verizon Code of Conduct, the Verizon Credo, and the Verizon business standards all
serve as expressions of the company's guiding values. At Verizon, we base our actions on a
set of core values that include honesty, respect, excellence in performance, responsibility,
and accountability.
Verizon's net income dropped in 2020, but it rebounded by 23.9% in 2021. The overall sales
growth rate increased from 2020's 2.7% to 2021's 4.14%. The EPS estimate for 2021 has

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been raised from $4.65 to $5.32. Shares will now cost you $49.54 in 2021, down from
$53.19 in 2019. Current and total liabilities for Verizon Communications are on the rise,
although they are far lower for the company than they are for AT&T and T-Mobile. While
AT&T has more total assets and current assets, Verizon has less of both. Comparable current
ratios of about 1 for both Verizon and T-Mobile and AT&T's current ratio of 1.6 indicate that
the book value of current obligations and current assets will be equal.
It employs a premium price approach in its marketing mix. Verizon spent over $3.4 billion on
advertising in the United States in 2021, placing them in the top 10 of the country's largest
marketers. In 2020 and 2021, the telecom giant will spend $4.1 billion on advertising, up
from the previous year's $3.1 billion. If you are willing to take on a significant amount of risk,
we advise investing in Verizon stock. The company's present situation does not augur well
for its future growth because of its links to the very unpredictable market for next-
generation 5G wireless services. Verizon stock, however, may be much more attractive if the
company's profitability and sales growth are revitalized by 5G cellular services.

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 Table of Contents
Particulars Page no.
Introduction 5
-Company Overview 5
-Products and Services produced 6
-Market Position 6
-Financial Information 6
-Goals 6
SWOT analysis 7
-Strengths 7
-Weaknesses 7
-Opportunities 8
-Threats 9
PESTEL Analysis 9
-Political Environment 9
-Economic Environment 10
-Social Environment 11
-Technological Environment 11
-Environmental Factors 12
-Legal Environment 12
Critical Issues 13
Strategic Direction 14
-Mission, Vision, and values 14
-Strategies and Objectives 16
Organisational Structure 17
-Structure 18
-Company Culture 18
-CEO 20
-Board of Directors 21
-CEO, Compensation and Net Income 21
Ethics Framework 21
Assessment of actual ethical behaviour 22
ESG Strategy 22
Financial Analysis 23
-Company Financial Performance 23
-Competitor Performance Comparison 24
Marketing Strategy 25
Company Outlook 29
Company Recommendation 31
Appendices 33
References 35
Table of figures:
Figure 1: Organisational Structure……………………………………………………………………………………………………17
Figure 2: CEO, net compensation, and net income…………………………………………………………………………..21
Figure 3: Financial Analysis…………………………………………………………………………………………………………23-25

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 Introduction
The ThinkQue Consulting Company has compiled data on Verizon Communications Inc.,
showing the company's strengths and weaknesses. Our suggestion, as well as in-depth
information and credible sources, are included in the research to assist you
in deciding whether or not to invest in Verizon.
Business Insights: Global, EDGAR, and Reuters were used to get an outside perspective on the
firm, as well as the company's own websites, for the purpose of compiling this paper. It also
gave us insight into the current and historic industry patterns that allowed us to evaluate
Verizon's standing in relation to its rivals. ThinkQue Consulting Company has provided a
summary of Verizon's data, including in-depth analyses of each area and supporting research
to establish the information's impact on the firm.
Finally, the study includes trustworthy data across a variety of categories, such as the SWOT
and PESTEL Analysis, corporate culture, the CEO, financial performances, and marketing
facets. To aid your decision, we analysed only up-to-date information currently available
about Verizon.

Verizon Communications

Company Overview
Verizon Communications was founded on June 30, 2000, when Bell Atlantic Corp. and GTE
corp. merged to create the biggest corporate merger in U.S. history. Its business reaches
across oceans and continents, serving customers in Asia, Europe, and the Americas. The
headquarters of the corporation may be found in New York City, New York, USA. Through
the use of novel means of communication and technology support, it has significantly
altered the ways in which individuals, communities, and objects connect with one another.
The following are the three types of business operations of Verizon:
ü Verizon Consumer Group (Consumer)
ü Verizon Business Group (Business)
ü Corporate and Other

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Products and Services Produced
Products and services from Verizon Communications, Inc. may be used for a variety
of purposes, including connecting with people and family, education and leisure activities.
The company offers wired and wireless phone and internet services. The company's wireless
communications solutions include both prepaid and post-paid phone and data services, as
well as the sale of related hardware. The firm's wireline communications solutions include
broadband data and video transmission, network security and management, international
telephone service, and global IP networks. Wholesale and retail customers include sole
proprietors, multi-national enterprises, government agencies, and telecommunications
companies.
Market Position
Verizon has maintained a spot in the top 20 of the Fortune 500 ranking of American firms
for more than 20 years. The network's dependability and speed have been confirmed by many
third-party sources. The following is a summary of third-party assessments of Verizon's
services:
ü American Customer Satisfaction Index consistently ranks Verizon above its rivals in
terms of voice quality, call dependability, network connection, and internet speed.
ü J.D. Power has been recognizing it as the Most Awarded Wireless Company for
Network Quality for the last 12 years.
Financial information
The company's revenue for the fiscal year that ended in December 2021 (FY2021)
was US$133,613 million, increased 4.1% from FY2020. Verizon's total annual revenue has
placed it in the top 20 of all American companies on the Fortune 500 list for over 20 years. A
diluted profits per share of $3.49 is expected for the year 2022. As opposed to the operating
margin of 21.1% in FY2020, quarterly dividends per share of $0.652, and capital
expenditures of $15.8 billion, net cash provided by operational operations in FY2022 was
$28.2 billion. The company's quarterly revenue for the period ending in June 2022 was
US$33,789 million, risen by 0.7% from the previous period. In FY2021, the company's net
margin was 16.5%, improved from 13.9% in FY2020.
Goals
§ It is predicted that by the year 2035, all emission levels would have been
eradicated from production.

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 § By 2030, 10 million kids will have access to e-learning opportunities.
§ One million small enterprises will have access to financing by 2030, allowing them
to compete successfully in the digital economy.
§ Roughly half a million people will have the modern job-readiness skills they need
by 2030.
Verizon is dedicated to promoting economic, environmental, and social development via
its three key principles: climate protection, digital inclusion, and human wellbeing.
Verizon introduced 5G for commercial use in mobile edge computing, fixed wireless, and
mobility before any other company in the world.

SWOT Analysis

Strengths
Verizon maintains an outstanding R&D advantage because to their dedication to cutting-
edge technological initiatives like the 5G Network and the 4G LTE. Verizon is the leading US
cellular operator in terms of both network quality and market share. When a company has a
dominant share of a market, it has a great chance to advance the industry and solidify its
dominance. The organization operates from 150 facilities in 30 different countries across
three continents (Europe, North America, and Asia-Pacific). According to Statista, Verizon
has a 31% share of the US market, making it the industry leader. With a net profit margin of
14.22%, Verizon is more lucrative than its main rival AT&T (which has a net profit margin of
11.34%), placing it third among all publicly traded companies in the United States. When
competition is fierce and goods are mostly interchangeable, companies may set themselves
apart via creative and extensive marketing. Verizon is widely recognized as an industry
leader due to its creative advertising approaches and customized offers. The 2014 "Inspire
Her Mind" campaign launched by Verizon is an excellent example of the company's
dedication to inspiring young women to seek jobs in the STEM fields. Powerful Answers,
Flipside Stories, and Better Matters are three more well-known advertising efforts. Verizon's
$500 million acquisitions of Alltel (2008), AOL (2015), Yahoo (2017), and BlueJeans (2020)
have been crucial for the company's growth and success. As an example, Verizon, after
acquiring Alltel, rose to the top of the market share rankings, (Miller, 2020).

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Weaknesses
Verizon's image was tarnished in 2017 when the FCC decided that the company had
leaked the private information of almost 6 million customers (Whittaker, 2017). The
Electronic Frontier Foundation has given Verizon a one star for its privacy policies. Concerns
surrounding air travel safety have also been voiced in relation to 5G. Therefore, Verizon has
delayed its 5G launch until January of 2022. (Hamilton, 2022). The loss of 68,000 cellular users
owing to the coronavirus forced Verizon to rescind their revenue prediction for 2020
which highlights the company's dependency on the American market (Supantha Mukherjee,
2020). Moreover, telecom companies like Verizon charge more as consumption increases.
Verizon raised their per-voice-line administrative fee from $1.95 to $3.30 in June 2022. (Dean
Seal, 2022). Also, the company falsely advertised, in at least one advertisement, that new
Verizon customers would be given a free iPhone if they signed up for its services. Better
Business Bureau investigations have repeatedly shown that Verizon promised 5G network
services before the underlying technology was even developed.

Opportunities
Verizon may evaluate novel applications for its 5G network considering the expanding
technological environment, including augmented reality, smart cities, driverless cars, and
teleconferencing. According to SkyQuest Technology, the rise of the 5G services industry will
be propelled by increased amounts of data traffic and the desire for quicker data connections.
By 2027, the 5G Services market is predicted to be valued USD 250,100.34M, rising at a CAGR
of 50.00% from 2021 to 2027 (Statista, 2022). Expanding current broadband connections to
cover a wider region is a good approach for making use of this potential. By broadening its
services, the company may attract new customers and compete for the loyalty of those who
may have switched to a competitor. Because of the spread of trade and communication
throughout the world, Verizon can provide all its services to customers in other countries. The
company may find a lot of new prospects in expanding into foreign markets. Verizon must
focus on the fast-rising Asian markets, much like Vodafone, if it wants to expand more swiftly.
The Asia-Pacific region accounted for 32.0% of the global telecom services market in 2020,
and the research predicts strong growth between 2021 and 2028. It's projected that by 2028,
this region will account for more than half of the world's new mobile users. By 2020, the
International Telecommunication Union predicts that China will have 854 million internet

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users and India will have 560 million users (ITU). After acquiring Alltel in 2008, Verizon
increased its market share and eventually overtook AT&T. Since the other T-mobiles have
merged with Sprint, Verizon may need to consider acquiring more smaller cellular carriers to
remain competitive and boost its status even further.
Threats
In the United States, Verizon faces stiff competition from both AT&T and T-Mobile.
When it comes to data limitations, for example, AT&T is still ahead of Verizon. On top of that,
T-Mobile is consistently gaining new customers. Verizon's biggest competition comes from its
competitors' low prices. Considering the tightening labor market and the push by union
members to organize retail and call center employees, Verizon Communications Inc. raised
its minimum wage to $20 an hour in April of 2022. (Moritz & Bloomberg, 2022) There will be
serious repercussions for Verizon's profits because of this. The company must charge more
for its services if it wants to be profitable, which might cause it to lose customers. Verizon's
price hikes began in June of that year, 2022. As a result, Verizon lost 215,000 postpaid
consumer phone subscribers in the second quarter ending in July, and CEO Hans Vestberg
forecasted the loss would quicken in the third quarter only last month (Blumenthal
2022). Leakage of sensitive information is a major problem for any telecom provider. Similar
situations may cost several million dollars due to lawsuits and other legal procedures. In such
a scenario, the company must exert great effort to win back the trust of its clients, which
might be a challenging task. Attacks against rented network infrastructure, such as residential
routers from ISPs, represent a serious risk to the communications industry. Once broken into
the system, hackers may utilize the compromised system to conduct fraudulent transactions
or steal private information. Telecom firms frequently compensate clients for losses incurred
because of such assaults to maintain good customer relations.

PESTEL Analysis

Political Environment
The new federal strategies support firm expansion between states by adopting a
market perspective. The administration's major priorities in the fields of technology and
communications were laid forth in an executive order signed by President Biden in June of
2021. The rules were put in place to make markets more competitive. The judgment argued
that the FCC should limit ISP-landlord exclusivity agreements to increase competition and

9
make broadband pricing clearer to the consumers. Another opportunity for the company's
growth and expansion comes from the government's increased spending on infrastructure,
notably the development of telecommunications infrastructure, which will allow it to
provide better services to customers. One such policy option that might help stimulate
economic development is the rollout of public Wi-Fi hotspots at no charge. However, the
telephone sector and related services face some of the highest tax rates in the United
States. When federal, state, and local taxes are included in, the effective rate of taxation on
transactions might be more than 18%. They are sometimes misinterpreted as a simple sales
or excise tax on telecommunications services when in fact they are far more nuanced and
subject to stricter oversight. All businesses have the challenging accounting problem of
keeping track of the myriad of taxes and fees that must be levied, collected, and sent.
(Deloitte, 2022).

Economic Environment
Household incomes in the developing world are growing rapidly. This is because these
countries didn't start using their natural resources until much later than industrialized ones.
Earnings per capita are growing at a rate of 5.2% per year in nations like India (Statista, 2022).
Therefore, Verizon Wireless may take advantage of this chance to increase its user base in
these markets. Possibilities to take advantage of the current situations may also be found in
the rapidly expanding economy of these nations. The unemployment rate in the United States
has dropped by 0.9% during the last year (Statista, 2022). The U.S. Department of Labor
reports that annual inflation in the United States decreased to 7.7% in the year ending in
October 2022, down from 8.2% in the preceding year. In the United States, the CPI is now at
298.01, after rising steadily over the last several years. All firms are feeling the effects of these
economic developments. The scenario is still unclear since the Covid-19 outbreak has
expanded over the world. There has been a worldwide economic collapse, which has made
conducting business difficult. U.S. GDP fell 8.9 percent in Q2 2020. (Bauer et al., 2020). Due
to the closure and quarantine, sales and production have dropped. Every company has felt
the effects of the current economic climate. Verizon is not immune to this terrible reality

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Social Environment
The popularization of mobile phone devices provides the company with another entry
point. By adapting to this new social norm, the company has a better chance of attracting
more customers and making more money. A study also states that 9 billion times a day,
Americans use their smartphones and other mobile gadgets. Many features on smartphones
and tablets now need both a powerful connection and the ability to access the internet,
thanks to the explosion in popularity of mobile computing. Telecommunications giants like
Verizon stand to gain greatly from the proliferation of online services accessible through the
internet. These new developments might aid the company's efforts to further enter the
market. However, the increasing importance of the telecommunications sector and industry
presents an additional threat to the company. It might encourage new companies to enter
the market, increasing overall competition. The use of the internet to access services has
increased in importance in recent years. Video streaming services like Netflix and YouTube
need a consistently fast and reliable Internet connection. Social factor analysis also
demonstrates that consumers are more inclined to products that are of higher quality. This is
another possibility for the company to expand its consumer base by providing innovative and
quality products.

Technological Environment
The company has an opportunity to succeed now that information infrastructures and
communication systems are accessible on a worldwide scale. The fast growth of
telecommunications infrastructure, particularly in rural areas, allows the company to invest
in new telecom services. Smartphones and tablets are becoming more common, but their
usefulness is limited without reliable Internet access. However, there is presently a threat of
a security breach in the telecoms industry. It is safe to say that the biggest threat to the
company's long-term success and public image comes from the Internet and other forms of
networking technology. There is a distinct and significant threat to the telecommunications
sector posed by attacks on leased infrastructure equipment, such as home routers from
Internet Service Providers (ISPs). If hackers manage to get into the system, they could take
sensitive data or use it to make international phone calls for free. To appease their customers,
telecom companies would typically cover any expenses due to these attacks (Deloitte, 2022).
The evolution of both communication and information technologies also suggests that the

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company invest in cutting-edge innovation to fuel its expansion and development. The U.S.
information and communication technology market is expected to reach $1275.60 billion by
2026, representing a CAGR of 8.3 percent between 2022 and 2030. Both new customers and
possible rivals in the industry may be drawn in by the rapid innovation and technological
progress, therefore this opportunity might be considered as a danger in the same sense.

Environmental Factors
Risk is fueled by environmental issues which may have severe implications on the
communications sector. To supply its services to customers, the telecommunications
industry relies heavily on infrastructure assets including networks and stations.
Consequently, a natural calamity can adversely damage their company. In the past 50 years,
the number of natural disasters has increased from 70 per year to 360 per year, a fivefold
increase (Leon, 2022). Conversely, the corporation has easy access to the increased capacity
of renewable resources. According to the Renewable Energy Annual Market report, the
worldwide renewable energy capacity is projected to expand by more than 8% in 2022,
reaching about 320 GW. The goal of long-term viability may be reached in this way. Hence,
businesses benefit from effective and appropriate social responsibility. The amount of
electronic refuse produced annually may be directly attributed to smartphones. Devices are
a significant contributor to electronic trash; thus, service providers are making significant
efforts to recycle them. It's likely that if their market standing is enhanced, sales will follow
suit.

Legal Environment
Companies are impacted in two ways by competition law, which is sometimes known
as anti-monopoly or anti-trust legislation. Commercial expansion and, by extension,
company size, are restricted by law. In addition to domestic employment and labor rules,
businesses operating internationally are also subject to a slew of other restrictions and
permits. The Federal Communications Commission (FCC) was founded in 1934 by the US
Congress to oversee federal laws governing American broadcasting. Carriers must adhere to
all applicable laws and regulations, including those pertaining to telemarketing and
individual privacy. Consumers are protected from potential security risks by means of
stringent restrictions. Data breach notification rules frequently require the establishment of

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a policy for the reporting, management, and public disclosure of incidents involving data
breaches. Due to security concerns, the company may have to limit the scope of its
offerings. A more secure environment, however, might lead to more satisfied customers and
greater growth.
Critical issues
The telecommunications industry is built on a solid foundation of information and
communication services, the telecoms market, and advertising in the mass media. These
findings suggest that although there are opportunities for growth for the company in foreign
markets, there are also dangers and weaknesses that must be taken into account. Verizon
Communications is plagued by serious problems with far-reaching consequences, including a
lack of diversity, intense competition, growing manufacturing costs, and a risk to customer
information.

In June 2022, Verizon raised its per-line phone service rate from $1.95 to $3.30 due to
increased inflationary expenses linked with the company's administrative, communications,
and regulatory compliance. Its biggest impact was the dissatisfaction of former clients.
Accordingly, Verizon Communication Inc. launched a new cost-cutting strategy, which is
presently being implemented, after higher corporate expenditures and rising interest rates
had a profound impact on profitability in the third quarter.

Competition has increased as more and more companies, such as AT&T and Sprint, enter the
telecommunications market, resulting in decreased profitability and the need for ongoing
innovation to keep consumers. AT&T, Verizon's main rival, offers identical service at
somewhat cheaper costs. This may pose a risk to Verizon's bottom line in the long run.
Therefore, it must differentiate itself from the competition by promoting the high quality of
the services it offers.

Data protection is a prominent problem in the telecommunications business because of the

carriers' extensive access to customer data. Example: Verizon alerted an undisclosed number
of customers that a hacker may have made unauthorized changes to their SIM cards between
October 6 and October 10, 2022. (Kelly, 2022). Verizon said the potential threat actor may
have obtained pricing plans and other service-related information in addition to customer

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names, phone numbers, and billing addresses. The company claims that it has reversed all
unauthorized account changes and reset all associated PINs. Since a result, such security
lapses should be avoided going forward, as they might have a detrimental effect on both the
current and future customer base.
Strategic Direction
Verizon Communications focuses on transformation during the lifetime. Strategic Directions
of Verizon pivot on who they are, what they do, and how they operate. It is clarified by the
company’s mission, vision, and objectives.
Mission, Vision, and Values
Verizon’s vision and mission statement describe that “By making people, companies,
and society more capable of creating new things and doing good deeds, it would live up to
the promise of the digital world; focuses on delivering, inspiring, and training to empower the
future via education”.
Verizon Communications focuses on three main mission values. They are: -
• Digital Inclusion
• Climate Protection
• Human Prosperity

Digital Inclusion
Just having access to something isn't enough in the digital world. The company’s goal is to
support technology's use for the purpose of bettering society, learning, and employment. By
2030, 10 million young people will have received training in digital skills. One million small
companies will have access to digital economy resources by 2030.
Due to their collaboration with the National 4-H Council, individuals in rural areas now have
access to digital skills instruction.

Climate Protection
By 2035, the firm plan to have completely carbon-free operations. To that end, it has made
investments in renewable energy and carbon offsets and are actively working to minimize
their emissions. Verizon’s efforts to recycle electronic trash cut down on water consumption,
and plant as many as one million trees are all ways through which they're doing their part to
preserve the earth for the next generation. They are dedicated to preserving our world and

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do all in their power to do so, from using renewable energy sources to joining forces with
reforestation initiatives.

Human Prosperity
The company helps the most vulnerable members of our communities through volunteerism,
digital-skills training, and supplier and employee inclusion.
Millions of kids' lives have been improved by the resources made available by the Verizon
Innovative Learning initiative. By 2030, it will have trained half a million people for the jobs of
the future. 59.3 percent, women and persons of color make up a sizable portion of
their labor force. By the year 2025, the company expects 2.5 million volunteer hours from our
workforce.

Values
Verizon’s core values comprise “A positive customer experience, growth and
profitability, speaking with people, keeping our word, delivering products digitally first, and
better matters for our clients”. Their culture and values are incorporated in the Verizon Code
of Conduct, and Credo.
• Beyond just listing the features and advantages of their products, they try to connect
with customers on a more personal level.
• Verizon employees are expected to treat all Verizon customers, employees, members
of the public, and vendors with the highest standards of civility, respect, morality,
honesty, fairness, and integrity. This is a moral as well as a commercial decision.
• Strongly dedicated to maintaining the best possible various methods of corporate
governance. We think that independent, competent, and inclusive board leadership is
the foundation of good governance.
• For their clients, doing business with them couldn't be simpler so hearing them out,
and anticipating their needs helps in the fulfillment of values.

Strategies and Objectives

Differentiation
One of the Verizon’s strategies is differentiation. This effective strategy made Verizon
the leader in the US market with the largest share. Verizon differentiated from its competitors
by adopting rigorous and ingenious marketing. Verizon provides Avant-grade products and

15
services like 4G lite to 5G network, VoIP, and Fios. It provided offerings with lowest
functionalities. In 2000, there was a prominent problem of dropped calls faced by customers.
Verizon listened to consumers pain points and innovated to solve it by launching a “Test Man”
campaign with marketing tagline of “Can you hear me now?”. This marketing strategy
increased the company’s growth for the next several years. Additionally, Verizon using
Innovid’s new tools to optimize Ad creative on CTV (Lafayette, 2022). Verizon is the first one
to gain this opportunity.

Cost cutting strategy

Verizon is meeting this strategy by launching a four-year, $10 billion cost-cutting
program since 2017. Verizon has combined virtualization, retirement offers to its
administration, operative efficiencies through its One fibre and intelligent edge network
initiatives (Robuck, 2021). Verizon ended this program last year and announced to start a new
program that will reduce the cost of $2-$3 billion by 2025. This program will focus on
digitalization efforts to enhance the customer experience and streamlining internal
operations with automation and process enhancements (Dano, 2022).

Market penetration
Verizon has increased its financial performance and market share through various
actions. Verizon focused on 5G strategy to cover major market share. Also, Verizon is
accelerating to build C-band network. Verizon is becoming a leading telecommunication
company by attracting huge number of customers. This has been achieved by providing
unlimited plans offer. It has laid great emphasis in providing consumer services like “wireless
workshops” that gives detailed information from professionals.

Organizational Structure

Verizon's success can be traced back to the company's well-developed internal structure. It
has opted for a functional organizational style. Grouping workers into teams based on shared
skillsets or responsibilities is a common feature of this approach. Employees with identical
skill sets and knowledge bases work together more effectively under a functional framework.
It has benefits such as specialization, efficiency, and responsibility.

16
The company’s administration is structured into departments that are accountable for
separate divisions of the company and its activities. Verizon's two main divisions, the
Consumer Group, and the Business Group, are structured around distinct subsets of the
company's customers. The key centralized departments of the organization are
Administrative, Legal, Public Policy, Finance, Global Network and Technology, Human
Resources, Marketing, and Strategy. The business divisions receive assistance and supervision
from these centralized groups, each of which is directly responsible for its own specific
function.

However, there are often issues that have far-reaching effects on many functions of the
business. Representatives of the senior management team consisting of serve on several
cross-functional governance councils, controlled by the CEO, Hans Vestberg, that
evaluate and finalize matters that cut across functional organizations, to guarantee that
decisions in these areas are made in Verizon's collective interest.

The management councils have focus on many different elements, such as:

• Creating Verizon's strategy and making sure it's being implemented properly.
• Deciding on how company resources will be distributed
• Guaranteeing that Verizon's operations are in line with the company's stated
commitment to social responsibility
• Monitoring and authorizing all the company's major technological projects
• Managing the expansion of the business's product lines
• Analyzing the company's potential for new purchases, sales, strategic investments,
and partnerships
• Supervising brand strategy and customer service

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 Hans Vestberg
CEO, Chairman
Consumer Group Business Group
Sampath
Manon Brouillette Sowmyanarayan
EVP & CEO EVP & CEO

(Functional Groups)
Finance Global Networks Strategy Marketing
Matthew Ellis Kyle Malady Rima Qureshi Diego Scotti
CFO EVP CSO CMO

HR Legal
Samantha Vandana
Hammock Venkatesh
EVP CLO

Company Culture
Verizon has a culture that encourages innovation, with the management always on
the lookout for ways to improve upon the company's present products and come up with
brand new methods to help its customers with their ever-changing and unpredictable
demands. In this way, the company's workplace culture helps it to be more competitive and
achieve greater strategic success. The cultural traits also encourage employees to look for
ways to meet the company's stringent quality requirements for its ICT products and services.
The culture at Verizon Communications, Inc. is characterized by the following traits:
• Teamwork
• Value-driven foundation
• Quality and reliability
• Customer centricity
Verizon, on the other hand, is just as committed to fostering an environment where all
workers may thrive, particularly regarding issues of cultural diversity, gender equality, and
environmental responsibility. According to Verizon’s Human capital report, 2020:
• Verizon had a 100% score in 2020 corporate equality index
• 59.7% of workforce comprises women and people from different cultural
backgrounds.

18
 • 7 of 11 board members are women or ethnically diverse
• $203.6M financed for employee training and development in 2020
Employee benefits
Verizon is proud to be ranked #17 on Comparably’s list of Best Companies for Perks
and Benefits, and #8 for Best Compensation in 2019. It offers its workers a variety of benefits,
including financial aid for services like adoption and a matching 401(k) contribution, as well
as professional and personal services like health care and paid time off. At no cost or
obligation, the EAP (Employee Assistance Program) is available around-the-clock, to help with
issues including child care, elder care, and adoption. Employees can obtain assistance with
issues like mental health and drug misuse, as well as stress control and dealing with financial
struggles. Any eligible employee is entitled to eight weeks of paid parental leave at full pay.
Women are entitled to up to 16 weeks of paid maternity leave, which may be used at any
time between short-term disability and the parental leave. Stock Together is a company-wide
equity award program that allows employees to participate in Verizon's success and the value
they produce via the grant of Verizon Restricted Stock Units at the discretion of the company's
board of directors (RSUs).

Employee training
Having the proper abilities is crucial to realizing a vision and plan for creating the
networks and technologies that will drive the future. Hence, Verizon provides its employees
comprehensive training in several areas, including sales, customer service, data science, 5G
technologies, and artificial intelligence. More than a hundred thousand Verizon workers will
get SkillUp and MyEdge training in 2021 so that the company can meet the demands of its
growing business. To keep up with the rapid pace of technological change, it uses cutting-
edge tools to help staff learn and improve including Virtual reality and augmented reality
training on shop safety, customer relations, and technical procedures and globally accessible,
instructor-led instruction via our engrossing and interactive Adobe Connect 9 platform.
Verizon's Learning Portal 2.0 provides a diverse collection of learning resources for all
workers, including materials from Harvard ManageMentor and Harvard ManageMentor
SPARK, LinkedIn Learning, and Pluralsight. The company has also supported several employee
training programs like Women of World (WOW). Participants in this year-long program will
strengthen their leadership abilities and acquire useful new skills for their careers. The two-

19
day WOW Expo is the conference's capper consisting of newer avenues to expand network
by meeting new people.
Furthermore, Verizon enjoys an overall rating of 4.1 and 3.4 with regards to overall pay and
benefits as well as job security and advancements respectively. Based on ratings out of five,
approximately 67% reviewed the company as having “cooperative work culture”, “good work
life balance” (Indeed, 2022). However, some employees have also stated that working at
Verizon is “too much pressure”. Resultantly, the company received about 11% of negative
feedback. (Indeed, 2022).

CEO
Verizon is led by Hans Vestberg, who serves as the company's chairman and chief
executive officer. Mr. Vestberg was Verizon's CTO and president of Global Networks in
2017. He oversaw the company's efforts to design its fibre-centric networks. He assumed
the role of Verizon's chief executive officer in August 2018 and its chairmanship in March
2019, thus replacing Lowell McAdam who had been at this position for seven years.
Hans spent the previous six years as the CEO of Ericsson, a Swedish multinational
corporation that provides networking and telecommunications equipment and services. In
this capacity, Vestberg has pioneered Verizon’s efforts to create seamless experiences for
consumers via the company’s network, while exhibiting a willingness to challenge traditional
systems and practices to make Verizon stronger and more efficient. Verizon is the first
company in the world to deploy 5G home and mobile technology thanks to Vestberg's
efforts to make the company more customer-centric 2.0.
Verizon, under Vestberg's leadership, signed a $700 million contract to outsource a large
portion of its IT operations to the Indian company Infosys.

Board of Directors
There are now 12 members on the board, all of whom have held management,
president, or CEO roles at firms including UPS, Starbucks, PayPal Holdings, and Procter &
Gamble in the past. The aforementioned roles contribute a wide variety of experiences and
perspectives to the board of directors. Aside from CEO Hans Vestberg, several of the board
members do not work for Verizon. Mr. Vestberg's presence on the board of directors might

20
be seen as a conflict of interest since he can be biased in favour of the business. The
composition of the board is described in further detail in the Appendix.

CEO, compensation and Net Income

A usual CEO in the United States earns $18.3 million per year in benefits and
compensation. Hans Vestberg and CEOs at AT&T, earn far more than the market average.
Due to the company's smaller net income, T-Mobile is able to pay its CEO a lower than
average salary. When compared to the remuneration received by the CEOs of AT&T and T-
Mobile (12.36 and 4.96 percent of market share, respectively), Hans Vestberg's
compensation amounts to 9.21% of net income. He earns a share that's second only to
AT&T's, which is the biggest of the three.

Name Of Company Verizon AT&T T-Mobile

Total Compensation $20,342,871 $24,820,879 $1,498,462
(USD)
Company Net Income 220,650,000 200,810,000 30,240,000
(USD)
Percentage of company 9.21 12.36 4.96
Income
Source: Verizon Communications, 2021

Ethics Framework
Verizon has a set of guiding principles communicated via the Verizon Code of Conduct,
the Credo, and its business rules. Integrity, respect, performance excellence, accountability,
and social responsibility are the cornerstones of the Verizon ethos. The Verizon Code of
Conduct provides employees with in-depth recommendations on how to put the company's
ideals into practice when confronted with the myriad of circumstances that occur on the
job. In order to enforce company ethics policy in an effective manner, Verizon has put in place
Verizon Ethics whose mission is to encourage honest and fair dealings among Verizon
employees. Through its code of conduct, it aims to ensure a respectful, safe and professional
workplace for its employees as well as security of consumer information. It claims that any
and all client data collected, used, or disclosed serves a lawful business purpose. Anyone with
questions, needs help, or has concerns regarding ethics, compliance, or the Employee or
Supplier Code of Conduct may call the private worldwide compliance hotline, which is open

21
24 hours a day, seven days a week at 844-894-8433, verizonethics.com, or
[email protected].

Assessment of actual ethical behaviour

Although Verizon’s ethical framework encompasses a holistic view of safeguarding the
interests of its employees and customers, it has not been able to fulfil its commitments.
After reaching an agreement with the Federal Trade Commission (FTC), Verizon paid a
punishment of $1.35 million for its improper use of "supercookies," a kind of software that
secretly tracks a user's online activity and is difficult for the user to erase. As a result,
customers will see more relevant adverts when their browsing habits have been tracked
(Zacks, 2016).
Moreover, many Americans were concerned that ISPs would exploit their newfound market
flexibility to slow customer's internet connections in order to increase their profits after the
FCC rescinded its net neutrality directive. The recent revelation that Verizon intentionally
slowed down the data speeds of the Santa Clara County Fire Department, severely hampering
emergency services during California's worst wildfire in state history, has further fuelled these
concerns. Fire departments experienced data slowing in an effort to pressure them into
purchasing a more costly data plan. According to a statement made by the SCCFD fire chief,
the department demanded quick removal of the data throttling. Verizon hasn't refuted the
fire chief's assertions that the company pressured them to upgrade to a more expensive data
plan through email, which further adds credence to the chief's claims. Such Coercion on part
of Verizon is unethical and doesn’t support its ethics policy (Föehl, 2018).

ESG Strategy
Verizon's ESG approach is built on four pillars—governance, integration, engagement, and
reporting—that all work together to achieve these goals. These interdependent tenets
provide the groundwork for strategic thinking on Verizon's most consequential
environmental, social, and governance (ESG) challenges and opportunities, as well as for
genuine participation from all parties involved.
Verizon's ESG activities are driven by a cross-functional ESG team, with assistance from ESG
ambassadors and experts from around the company. In 2021, the topics most frequently
addressed are:

22
 • Climate change - zero operating emissions
• Recycling of electronic devices and garbage
• Worker Involvement
• Talent Acquisition, Management, and Development
• Supply Chain Management
• Board Composition and Competencies
• Corporate Social Responsibility

Financial Analysis
Company Financial Performance
Following a decrease in net income in 2020 when 70% of its retail stores shut down
because of covid, Verizon raised their net income by 23.9% in 2021. Total revenues
expanded from 2.7% in 2020 to 4.14% in 2021. The return on sales improved from 21% to
23.4% between 2020 and 2021. There has been a decrease in current assets by 32.7% in
2021 but total assets have increased by 15.8% from the prior year. Current liabilities and
total liabilities increased by 18.9% and 15.8% respectively. The debt-to-equity ratio
decreased by 4.4% from the previous year. The return on equity went up by 7.04%
currently. The earning per share has gone up from $4.65 USD in 2019 to $5.32 USD in 2021
showing positive net growth. Stock price has gone down from $53.19 USD per share in 2019
to $49.54 USD per share in 2021.

2019 2020 2021 Sept 30, 2022

Total revenue 131,868 128,292 133,613 34,241.0

Total expenses 101,490 101,325 102,327 14,601.0

Net income 19,265.0 17,801 22,065 4,900.0

Current Assets 37,473 54,595 36,728 39,746

Total Assets 291,727 316,481 366,596 375,090

Current 44,868 39,660 47,160 53,141

liabilities

23
 Total no. of 4,136. 4,138 4,197.8 4,200
common stock
outstanding
Stockholders’ 61,395.0 67,842.0 81,790.0 87,468.0
equity
Return on sales 23% 21% 23.4% 23%

Current ratio 0.84 1.38 0.78 0.75

Return on 33.64 27.55 29.49 23.45

Equity
Debt to equity 3.64 3.57 3.41 3.23
ratio
Reported EPS 4.65 4.30 5.32 4.60

Period- end 53.19 52.73 49.54 38

stock price
Payout ratio 52.03 57.50 47.42 55.94

Market Cap 253.9B 243.1B 218.1B 159.5B

Source: Business Insights Global, Reuters Fundamentals (2022)

Competitor Performance Comparison

Verizon communications total current liabilities and total liabilities is increasing but
in comparison with AT&T and T-Mobile, Verizon has fewer liabilities. Verizon has fewer total
assets and current assets over AT&T. Both Verizon and T-Mobile have similar current ratios
around 1 implies that the book value of current liabilities and current assets will be the
same, but AT&T has current ratio of 1.6. Generally, a current ratio between 1.6 and 2 is
healthy. It indicates that AT&T can pay its short-term obligations efficiently. In comparison
to both AT&T and T-Mobile, Verizon has the highest debt to equity ratio i.e., 3.23. A healthy
debt-to-equity ratio is normally less than 1.0. As a result, it is engaging in debt financing
which indicates higher financial risk. Verizon also has the highest EPS of $5.32 in comparison
to both the companies. Verizon is in a better place than all three in terms of profitability,
ROE, ROS and EPS. However, T-Mobile has the highest stock price due to recent acquisition
of Sprint (Reuters, 2022).

24
 Verizon AT&T T-Mobile
Communications
December 31, December 31, December 31,
2021(in millions) 2021(in millions) 2021(in millions)
Total revenue $133,613 $168,864 $80,118

Total expenses 102,327 145,517 73,326

Net income 22,065 20,081 3,024

Current Assets 36,728 170,786 20,891

Total Assets 366,596 551,622 206,563

Current 47,160 106,230 23,499

liabilities

Total no. of 4,197.8 7,141 1249.2

common stock
outstanding
Stockholders’ 81,790 166,332 69,102
equity

Return on sales 23.4% 13.8% 8.6%

Current ratio 0.78 1.60 0.88

Return on 29.49 13.96 2.22

Equity

Debt to equity 3.23 2.05 2.04

ratio
Reported EPS 5.32 2.76 2.41

Period- end 49.54 17.29 115.98

stock price
Market Cap 159.5B 137.6B 188.6B

Source: Business Insights Global, Reuters Fundamentals (2022)

25
 Marketing Strategy

Target market
Although it doesn’t have a well defines target market, Verizon’s client
demographics are somewhat inclined towards the older Americans. Data shows that 22% of
people in the 50-64 age bracket pick Verizon as their internet provider (Statista, 2022).
However, just 21% of those between the ages of 30 and 49 and 18% of those between the
ages of 18 and 29 share this view(Statista, 2022). Verizon's geographic segmentation
strategy is particularly effective in foreign markets because of the cultural and differences
among potential consumers. Verizon uses psychographic segmentation to separate its
prospective client base into various categories based on a broad variety of criteria, including
customers' personalities, shopping habits, leisure activities, and pursuits. Psychographic
segmentations are helpful because persons in the same demographic may have remarkably
different psychographic characteristics as a result of their sociocultural factors and lifestyle
choices.

Product mix
Verizon Communications, Inc.'s product mix is changing in response to shifts in the
market and developments in related technologies. Through its subsidiaries, the Company
serves the communications, information, and entertainment needs of individuals,
organizations, and government agencies. Verizon Consumer Group and Verizon Business
Group are the two notifiable segments. In the Consumer division, the company offers both
wireless and wired phone services to its customers. Through its Fios brand and its
conventional copper-based network, it offers wireline services in nine states in the Mid-
Atlantic and North-eastern United States, as well as in the nation's capital. Its Business
division offers local and long-distance phone services, as well as data, video, and
conferencing services, network security and management, and network access for the
distribution of a wide range of Internet of Things services and products.
It relies on other companies like Apple, Blackberry, LG Electronics, HTC, Motorola Mobility,
and Samsung to produce the devices and accessories it sells. The following major product

26
divisions make up the firm's existing product mix after its 2017 restructuring process.
(Smithson, 2017)
• Wireless
• Residential
• Business

Verizon Wireless offers a wide variety of products, including wearable devices, broadband,
home solutions, and cellular phones. Verizon's Residential product category includes
Verizon Fios web, Verizon Fios TV, and Verizon Fios Digital Voice. Verizon Business focuses
on providing cutting-edge technological corporate solutions like as networking, security, the
web computing, and the Internet of Things (Mehta, 2022).
In 2015, Verizon introduced their Hum product and service, which offers diagnostics and
monitoring equipment for automobiles. In 2016, it bought the telecom provider and
mapping platform Social Radar. In 2019, the company announced free robocalling and anti-
spam procedures for the customers as part of its services. Verizon announced their own
web browser, called "One Search," in 2020. The company also acquired TracFone Wireless
that year and worked with Apple to provide 5G connectivity to the iPhone 12 series in 2021.
(Mehta, 2022)

Pricing Strategy
Verizon's price stability is a major asset as the company navigates the increasingly
competitive cellular industry (Third Bridge analyst Jamie Lumley, 2022). It follows two kinds
of pricing strategies:
Premium pricing strategy
Verizon had introduced price hikes of $5 to $10 monthly in its cellular service plans which
provides increased data allowances along with a handful of additional bonuses. Customers
that often go over their data limitations have the option of activating Safety Mode, which
would slow their connection speed to 128 kbps (a snail's pace) if their limit is reached,
rather than being charged for overages (Reuters, 2022). Customers on Verizon's two biggest
plans (designed for families) automatically get Safety Mode at no extra cost, but the
company will charge the rest of its customer base $5 per month to enable the function.
These tactics are effective in upselling existing customers to more expensive plans and

27
retaining its most valuable clientele, families. Customers that use numerous devices are less
likely to quit, therefore catering to their needs in this way is likely to result in even more
loyalty. Verizon gets the maximum profit from these clients by charging an additional $10 to
$20 per device on a family plan, regardless of how much data is actually used (Morningstar,
2022). Verizon's higher-priced plans come with larger monthly data allowances, and now
the firm will carry over unused data into the next billing cycle.
Value Based Pricing strategy
In 2020, Verizon began offering Select Mix & Match unlimited wireless subscriptions that
included Disney+, Hulu, and ESPN+1 in combination to Apple Music and the super-fast
speeds of 5G Ultra Wideband2 (Bloomberg, 2022).

Distribution strategy
In order to reach new customers, Verizon relies heavily on its "Verizon Destination
Stores" retail chain. The corporation also places a significant emphasis on sales made
through its website and via calls handled by its telemarketing sales personnel. In addition to
its own websites and physical stores, Verizon also makes use of the Internet and brick-and-
mortar establishments via exclusive selling relationships with agents. In addition, Verizon
products may be purchased through Wal-Mart, Best Buy, Target, and Dollar General, among
other large retailers. Verizon markets and distributes its goods and services to both
individual consumers and institutional businesses via a variety of direct and
indirect channels.
Its distribution strategy relies heavily on the direct channel, which includes company-owned
retail locations. Important distribution methods for its services include its sales and service
centres and its business-to-business direct sales teams. In the United States, agents selling
wireless and wireline goods and services in retail locations and online make up a large part
of the indirect sales channel. Most of these deals are closed via Verizon's exclusive
distribution channels. The Business division's distribution channels include not only the
direct sales force, but also resellers, distributors, and system integrators who help with
things like device fulfilment and integrated mobility services (Verizon Communications,
2022).

28
Promotional Strategy
Verizon spent around $3.4 billion in 2021 to market its goods in the United States,
putting it in the top 10 of the country's major advertisers. The telecom giant raised its
advertising budget from $3.1 billion to $4.1 billion between 2020 and 2021(Verizon
Communications, 2022)
Sales Promotion
Verizon is offering a $25 monthly discount to students who sign up for its Unlimited plan.
Customers who are interested in switching carriers in the hopes of lowering their monthly
bills can take advantage of Verizon's smartphone deals and other sign-up bonuses
throughout the year. New customers who shift to Verizon Get a gift card worth up to $500
(Verizon Communications, 2022).
Advertising
Verizon uses both conventional media advertising (magazines, newspapers) and internet
advertising as part of their promotion strategy in the marketing mix. As part of a joint
advertising effort between Apple and Verizon, Apple TV online stars Adam Scott and Cecily
Strong appear in a promo for the Verizon One Unlimited plan for Apple iPhone (Corry,
2022). Kyrie Irwing, a professional basketball player, and Jim Carrey, an Oscar-winning actor,
are just two of the many notable people who have enthusiastically endorsed Verizon
Wireless.
Sports Sponsorships
As a marketing effort, the telecommunications firm is a co-founding partner of the United
States national handball team and the exclusive licensee of the National Hockey League for
promotional and marketing purposes. Verizon also serves as the naming rights sponsor for
the Verizon Centre in Mankato, Minnesota, and the Verizon Arena in North Little Rock,
Arkansas (Verizon Communications, 2022).
Marketing Campaigns
Verizon's marketing plan involves a number of different marketing efforts meant to increase
brand recognition. Can You Hear Me Now? (Paul Marcarelli-led commercial for Verizon
Wireless), There's a Map for That, Powerful Answers, and Inspire Her Mind are just a few of
the most well-known campaigns (Verizon Communications, 2022).

29
 Company Outlook
In the forthcoming years, Verizon’s income will rise just marginally for a variety of reasons
(Krause, 2022). Oversaturation in the U.S. cellular business is a long-term challenge for
Verizon. The hefty cost of new mobile phones discourages many consumers from upgrading.
Furthermore, data-intensive mobile video hasn't proven to be a lucrative business.
Analysts predict that Verizon will see annual gains of about 2% until 2024 (Moritz, 2022).
This is because the company intends to implement growth strategies such as offering
customers costlier 5G unlimited data plans, introducing wireless home internet, and
formulating strategic partnerships with major technology companies like Meta.

Higher promotional activity will lead to a short-term drop in Verizon's net profit, which is
why the company's net profits for the most recent quarter fell short of forecasts. With
Verizon's challenges mounting and mobile client growth slowing from 2021's highs, this is
projected to fall over time. As 5G networks are being rolled out, Verizon is in the midst of a
heated marketing competition. On top of that, Apple has unveiled iPhone 14. Therefore,
cellular companies countered with fresh discounts (CNN Business, 2022).
Analysts are concerned that Verizon will have a hard time competing with AT&T and T-
Mobile US in the cellular market. The race to provide the fastest and most reliable wireless
5G network is set to heat up. A surge of new, low-priced advertisements is being offered by
cable TV providers (Kreitzberg, 2022). T-Mobile is now a more formidable competitor after
purchasing Sprint. AT&T also combined its Warner Media and Discovery operations.
Therefore, a reduced AT&T will likely be in a better financial position to invest in 5G wireless
infrastructure and fibre-optic offerings.

Stock price ranged from $52.73 to $49.54 during the last 52 weeks, closing at $38 for the
quarter ended September 30, 2022. Moffett Nathanson analyst Craig Moffett has lowered
Verizon stock to under-perform despite the modest variations. According to him, "Verizon
has lost market share in every quarter since the second quarter of 2020, whether you're
looking at total phones or post-paid phones." In contrast, the consensus forecast among
financial experts is that the stock price will close the year 2022 at $43, plus 10.40% from its

30
previous price. The high pay-out ratio of 55.49 and the dividend yield of 4.8 percent are
primary reasons for this (Statista, 2022).

According to NASDAQ's projections, investors should immediately begin purchasing Verizon

stock. With a 2.9 rating from Yahoo Finance, it is advised to "Hold." In addition, Zacks gives it
a rank #3 (Hold). All three show a stock rating of ‘Hold’ since October 2022. Due to its ties to
the very volatile market for next-generation 5G wireless services, the company's current
position does not bode well for its future development. However, Verizon stock might be
considerably more appealing if 5G cellular services revive profits and sales growth. Our
proposal is in line with the predictions made by the analysts at NASDAQ, Yahoo Finance, and
Zacks.

Company Recommendation
Following the analysis of Verizon Communications Inc., the ThinkQue Consulting Company
advises to invest in Verizon if a high risk-high reward investment is desirable for your
portfolio. Many aspects of the analysis have been considered and brought together to form
this recommendation. Although it gives out bountiful dividends and has potential for
expansion, there are certain risks that investors should consider.

Verizon is the preferred wireless provider for more than 140 million customers (Statista,
2022). The telecom giant's large user base is a consistent source of income and profits.
Verizon sees exciting potential for expansion in the emerging market for 5G wireless and
broadband internet services. Rapid download speeds should encourage consumers and
companies to use more data, which in turn should increase demand for Verizon's more
expensive, higher-margin plans. Verizon's ability to package cellular and home internet
services is an additional factor that keeps customers loyal to the company's offerings.
Verizon's traditional wireline business has been declining, but lower churn rates of
0.95% should benefit the company's bottom line (Finance Yahoo, 2022). The best part is that
Verizon stock is inexpensive. Shares of the cellular industry titan are presently trading at a
discount of roughly 8.4 times trailing 12-month profits, thanks to a 25% drop over the last
year (Wall Street Journal, 2022). Based on 2023 earnings expectations from Wall Street, the

31
business has a forward P/E multiple of 7.6. And the dividend yield for Verizon shares has
increased to a healthy 6.8% (Wall Street Journal, 2022).
There is also a new senior management team. Former Ericsson CEO and current Verizon CEO
Hans Vestberg has extensive experience in the networking industry. Both Vestberg and
Verizon's Chief Strategy Officer Rima Qureshi, formerly of Ericsson, joined the company that
year.
Verizon has been able to borrow huge amounts to invest in its network and other expansion
efforts owing to its remarkable cash flow creation. It has accumulated about $150 billion in
debt (Business Insights Global, 2022). That's an enormous sum that shareholders can't
ignore.
The Federal Reserve raised interest rates by 0.75 percentage recently (CNBC, 2022).
If interest rates keep climbing, Verizon could have to pay more to refinance its debt. The
corporation is acting prudently by pursuing a cost-cutting strategy that may save as much as
$3 billion yearly by 2025, boosting its profitability and allowing it to more easily pay down its
debt (Verizon Communications, 2022). However, it may be years before new 5G wireless
services become financially viable, thus the investors must only invest if high risk is suited to
their portfolio.
Investors face an even higher risk from intense competition. When AT&T sold its Warner
Media division in April, it became a more dangerous competitor. AT&T can now devote its
considerable resources to its wireless and internet operations rather than its failed attempts
to break into the entertainment industry. Post-paid customers are the most valuable to cell
phone companies, and AT&T gained 813,000 of them in the third quarter (Motley Fool,
2022).
Another concerning opponent is T-Mobile. The 2020 merger with Sprint enhanced the
telecommunications company's already robust network. Conversely, T-Mobile has received
praise for its 5G availability, download speeds, and other performance indicators.
Consumers seem to agree, as T-Mobile added 854,000 net new post-paid phone users in the
third quarter. Verizon, in contrast, attracted only 8,000 post-paid customers over the last
quarter (RootMetrics, 2022). According to these numbers, Verizon is losing ground to rivals
in its most lucrative customer category. Despite its strong promotional efforts, the
competition between the rival firs is continuously increasing.

32
Verizon may find success capitalizing on the anticipated growth in demand for its 5G cellular
services which is quite uncertain. However, current trends indicate that AT&T and T-Mobile
have a greater chance of competing and succeeding in this crucial sector. Therefore, Verizon
stock may not be as good of a deal as its cheap price suggests. Until Verizon proves it can
increase subscribers at a rate comparable to AT&T and T-Mobile, income- oriented investors
with less tolerance for risk should avoid buying its stock.

33
 Appendices

Strengths Weaknesses
-Inventive capabilities -Security issues
-Market dominance -Dependence on the American market
-Strong financial position -Additional data charges
-Successful marketing -Misleading advertisement
-Acquisitions
Opportunities Threats
-Diversification -Market rivalry
-Global markets -Data leakages
-Expansion of acquisitions -Spending for growth
-Brand differentiation strategy -Growing rate of compensation
Appendix A: SWOT Analysis
Political Economic Social
-Government policies -Increase in Income -Popularity of mobile
-Governmental Investments -Spread of Covid-19 gadgets
-Web based services
Technological Environmental Legal
-Globalizations of ICT -Natural Disaster -Competition law
-Cyber Threat -Renewable resources -FCC restrictions
Appendix B: PESTLE Analysis
Campaigns Explanation
Can you hear now? This campaign was initiated by Verizon in
the year 2002. For the subsequent nine
years, Verizon's mantra was "Can you hear
me now?" This was a smart marketing
technique. In addition, the proportion of
Verizon Subscriber base rose by 10% to
32.5 million during the first year and by
15% more to 37.5 million in the subsequent
year.
Inspire Her Mind Verizon Wireless and MAKERS united to
design the 2014 campaign "Inspire Her
Mind.” It is a commendable campaign to
urge young girls to be more engaged in
science, technology, engineering, and math
rather than to focus on girls’ appearance.
There’s a map for that This campaign was introduced in late 2009.
It was a copy of AT&T's "There's an app for
that" campaign. AT&T sued Verizon for this
ad campaign. But later in the month, this
petition was rejected.
Appendix C: Campaigns

34
 Board Members Description
Hans Vestberg Chairman and Chief Executive officer of
Verizon Communications Inc., joined
Verizon in April 2017
Clarence Otis, Jr. Lead Director of Verizon Communications,
served as a director of Verizon since 2006,
former chairman and chief executive officer
of Darden Restaurants, Inc.
Shellye L. Archambeau Served as a director of Verizon since
December 2013, former Chief Executive
Officer of MetricStream, Inc.
Roxanne S. Austin Director of Verizon since 2020, President
and chief executive officer of Austin
Investment Advisors
Mark T. Bertolini Co-Chief Executive Officer of Bridgewater
Associates, LP, director of Verizon since
2015
Vittorio Colao Elected as a director on November 4, 2022,
former Italian minister for innovation,
digital transition and space, former Chief
Executive of Vodafone Group Plc
Appendix D: Board Member Information

35
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