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Verizon Launches Satellite-Messaging Service: Stock to Benefit?

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Verizon Communications Inc. (VZ - Free Report) recently announced that it had partnered with Skylo Technologies to enhance connectivity for the former’s customers by introducing a new satellite-based direct-to-device messaging service. This deal marks a strategic win for the U.S. telecommunication giant, showcasing its commitment to technological advancement in the nation.

VZ’s Focus on Emergency Services

Verizon has been at the forefront of integrating satellite technology with its services for rapid cell tower deployments, emergency responses and  extended coverage. Leveraging Skylo’s cutting-edge satellite technology will likely enable Verizon’s customers with compatible smartphones to use emergency messaging and location sharing outside traditional cellular coverage. The service is further expected to include text messaging by next year.

VZ Expands Satellite IoT Capabilities

Verizon’s expertise in IoT demonstrated through its use of 4G Narrow Band IoT and emerging RedCap technologies, is further advanced by this partnership with the nation’s largest wireless network provider, Skylo. The collaboration supports the development of satellite IoT technology, allowing the low-complexity and energy-efficient Verizon-enabled devices to seamlessly switch between terrestrial and satellite networks as needed. 

This satellite IoT roaming capability is poised to enhance geographic coverage for IoT devices across various industries, including transportation, agriculture, maritime sector, environmental monitoring and asset tracking in remote areas. For instance, in agriculture, it can monitor livestock, crops, soil quality and meteorological conditions in remote regions. In asset tracking, it will likely provide real-time updates even in the middle of the ocean.

Will VZ Stock Benefit From the Collaboration?

Verizon is offering various mix-and-match pricing in both wireless and home broadband plans, which has led to solid customer additions. With one of the most efficient wireless networks in the United States, the company continues to deploy the latest 4G LTE Advanced technologies to deliver faster data speeds and capacity for customers, driven by customer-focused planning, disciplined engineering and constant strategic investment. 

The partnership between Verizon and Skylo highlights the integration of satellite and cellular networks, emphasizing that satellite connectivity can enhance communication beyond emergency scenarios. As the first global mobile carrier to offer supplemental smartphone connectivity via Skylo’s satellite network, Verizon is well-positioned to benefit from enhanced coverage for both consumers and businesses. Additionally, it will likely strengthen Verizon’s reputation as a leader in digital transformation across diverse industries and improve its revenues in the upcoming quarters.

VZ Stock Price Performance

Shares of Verizon have gained 19.7% over the past year compared with the industry’s growth of 32.7%.

Zacks Investment Research
Image Source: Zacks Investment Research

VZ’s Zacks Rank and Key Picks

Verizon currently carries a Zacks Rank #3 (Hold). 

Some better-ranked stocks in the broader industry have been discussed below.

Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1 (Strong Buy) at present, supplies products to a prestigious set of customers, including Fortune 500 global companies in markets such as cloud titans, enterprises, financials and specialty cloud service providers. You can see the complete list of today’s Zacks #1 Rank stocks here.

It delivered a trailing four-quarter average earnings surprise of 15.02%. In the last reported quarter, Arista delivered an earnings surprise of 8.25%.

Harmonic Inc. (HLIT - Free Report) enables media companies and service providers to deliver ultra-high-quality broadcast and OTT video services to consumers globally. It delivered a trailing four-quarter average earnings surprise of 32.5%. It currently sports a Zacks Rank of 1.

Airgain, Inc. (AIRG - Free Report) currently carries a Zacks Rank #2 (Buy). It has a long-term earnings growth expectation of 35%.

Headquartered in San Diego, CA, Airgain offers integrated wireless solutions in the form of antenna products. These products are equipped to solve critical connectivity needs in both the design process and the operating environment across the enterprise, automotive and consumer markets. Ideal for original equipment and design manufacturers, vertical markets, chipset vendors, service providers, value-added resellers and software developers worldwide, the customizable antennas from Airgain serve both indoor and outdoor connectivity issues.

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