I Can See Verizon Risin'

There's gold in them thar ILECs.

I know, I know, guys like my pal Scott Moritz are always telling you the incumbent local exchange carriers are headed for the junk heap. Scott's particularly bearish on Verizon , the ILEC for the northeastern U.S., because he thinks the company's core business is melting away.

I'm here to tell you that's not so. When I look at Verizon, I see a company that owns a monopoly on phone access in a big chunk of the country and draws steady growth from its wireless, its DSL/data and, increasingly, its long-distance businesses. I see a company whose pressing competitive challenges remain years off. I see a stock that yields 3%, which is far more than I'm getting in my savings account right now, I'm afraid.

But that's not the half of it. Verizon is becoming increasingly aggressive with cost-cutting measures, and people like Scott have underestimated the growth potential here. As the teleconomy begins to recover, earnings estimates will march higher -- along with this stock.

The Finish Line

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