Will Verizon (VZ) Stock Gain on NBA Partnership?

Verizon (VZ) signed a partnership with the NBA to feature content from the basketball league on the company’s mobile video service.
By Amanda Gomez ,

NEW YORK (TheStreet) -- Verizon Communications (VZ) - Get Report stock is falling 0.41% to $46.26 in early afternoon trading on Wednesday as the company singed a partnership with the National Basketball Association to stream content on go90.

Daily highlights and original content will be featured on go90, the mobile video streaming service that Verizon introduced last month.

Users will also be able to purchase the NBA League Pass to stream live out-of-market games, whether its single games, team passes or full season packages.

Verizon will also become the league's official wireless service provider, which will lead to further marketing partnerships with the NBA.

"There's never been a more exciting time to be teaming with the NBA," Diego Scotti, Verizon's chief marketing officer, said in a statement. "The NBA has rapidly evolved into a year-round digital experience that engages millions of young, cross cultural fans, in many interesting ways."

Separately, TheStreet Ratings team rates VERIZON COMMUNICATIONS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate VERIZON COMMUNICATIONS INC (VZ) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, good cash flow from operations, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • VZ's revenue growth has slightly outpaced the industry average of 1.7%. Since the same quarter one year prior, revenues slightly increased by 5.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Diversified Telecommunication Services industry average. The net income increased by 9.3% when compared to the same quarter one year prior, going from $3,695.00 million to $4,038.00 million.
  • Net operating cash flow has increased to $9,520.00 million or 13.97% when compared to the same quarter last year. In addition, VERIZON COMMUNICATIONS INC has also modestly surpassed the industry average cash flow growth rate of 4.80%.
  • VERIZON COMMUNICATIONS INC has improved earnings per share by 11.2% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, VERIZON COMMUNICATIONS INC reported lower earnings of $2.51 versus $4.00 in the prior year. This year, the market expects an improvement in earnings ($3.97 versus $2.51).
  • The gross profit margin for VERIZON COMMUNICATIONS INC is rather high; currently it is at 59.87%. Regardless of VZ's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, VZ's net profit margin of 12.17% compares favorably to the industry average.
  • You can view the full analysis from the report here: VZ

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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