Comparing Verizon and AT&T Dividend Stocks

Sunday, 24 March 2024, 10:26

Verizon and AT&T both offer attractive dividend yields, but Verizon's stronger financial position and growing free cash flow make it the better dividend stock. With a higher credit rating and a clear path to increasing returns for investors through dividend growth and share repurchases, Verizon outshines AT&T in terms of income potential. While AT&T is making progress in strengthening its balance sheet, it still has a long way to go compared to Verizon.
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Comparing Verizon and AT&T Dividend Stocks

A better income stream

Verizon offers a better income stream. My long-standing relationship with the telecom giant was one of the many reasons I initially bought its stock.

Verizon's Dividend Growth

  • Verizon raised its dividend 2% last September, marking its 17th consecutive year of dividend growth.
  • Verizon's long-term target is to reduce leverage ratio and return more cash to investors.

AT&T's Financial Challenges

  1. AT&T slashed its dividend in half following a spinoff, impacting its financial flexibility.
  2. Debt levels and leverage ratio remain a concern for AT&T.

Further along

Verizon is ahead in deleveraging and aims to return more cash to investors. Capital spending reduction and rising free cash flow put Verizon closer to increasing dividends.

AT&T's Balance Sheet

AT&T is progressing in reducing debt but still lags behind Verizon's financial strength and dividend growth potential.

Verizon is the better option for income investors

Verizon's higher-yielding dividend, stronger balance sheet, and growth prospects make it the preferred choice for income-focused investors.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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