Verizon Communications Inc. (VZ) or AT&T Inc. (T): Which Major Domestic Telecom Should Investors Prefer?

A clear choice

Income investors might be tempted by AT&T Inc. (NYSE:T)’s higher dividend yield, which stands at nearly 5% after the stock’s poor price performance post-earnings. However, Verizon Communications Inc. (NYSE:VZ)’s lower dividend yield, approximately 4%, is a result of the company’s soaring stock price and not because of lower dividend growth.

AT&T Inc. (NYSE:T) has increased its dividend for 29 years in a row, but the company will have a tough time raising its dividend to a satisfactory degree going forward if it doesn’t get revenue back on track. On the other hand, Verizon is providing investors solid revenue growth that should propel both capital gains and dividend increases in the future. Because of Verizon Communications Inc. (NYSE:VZ)’s vast revenue outperformance, investors should prefer Verizon.

The article Which Major Domestic Telecom Should Investors Prefer? originally appeared on Fool.com.

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