NEW YORK (TheStreet) -- Shares of Verizon Communications (VZ) closed lower by 4.05% to $46.92 on nearly three times its average trading volume on Tuesday, after the nation's largest wireless carrier said that its end-of-the-year promotional discounts and price reductions are cutting into profit.
Verizon warned late Monday that the cost of its discounts in an effort to win customers will likely to hurt its wireless margins, overall margins and earnings per share in the fourth quarter.
The company said it's losing more customers to other carriers this quarter than previous quarters, due to heavy promotions from competitors.
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Also, three firms cut their price target on shares of Verizon this morning.
Citigroup lowered its price target to $50 from its previous $51 with a "hold" rating. Credit Suisse cut its price target to $52 from $54 with a "neutral" rating. And analysts at Robert W. Baird lowered its price target to $50 from $54, also with a "neutral" rating.
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 several positive factors, 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, notable return on equity, compelling growth in net income, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."