Verizon Communications Inc. (VZ): Show Me The Money

The big story here is Verizon’s beefy dividend. The great aspect of wireless communication services are that few people can live without them. Whether the economy is growing or slowing, the prices for Verizon’s plans are more or less inelastic. This means that Verizon has a relatively predictable cash flow figure it can count on each quarter, which is great news for a company that’s increased its dividend in each of the past six years.

Source: Nasdaq.com.
*Assumes $0.515 quarterly payout for remainder of 2013.

With a current yield of 3.9% Verizon Communications Inc. (NYSE:VZ) is more than doubling the yield you’d get by purchasing a U.S. 10-year bond. Sure, a 10-year bond is about as safe an investment as you can get, because it’s backed by the full faith and credit of the U.S. government, but the cash flow at Verizon would certainly come in as a close second in my book! With a cumulative $56.2 billion in free cash flow generated over the past four years, I’d say there’s quite a bit of staying power in this dividend.

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It’s not often that you find a company as dominant, or with a product that has almost zero downward pricing pressure, as Verizon Communications Inc. (NYSE:VZ). At least for now, Verizon has a superior technological advantage with its 4G LTE network, is focused on continued investments in that network (possibly through a buyout of its partner Vodafone Group Plc (ADR) (NASDAQ:VOD)), and looks primed to deliver market-trouncing dividends for years to come. It’s the epitome of a set-it-and-forget-it stock and certainly appears to be a great dividend stock you can buy right now.

The article 1 Great Dividend You Can Buy Right Now originally appeared on Fool.com and is written by Sean Williams.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool recommends DIRECTV and Vodafone Group.

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