Verizon Communications Inc. (VZ), Vodafone Group Plc (ADR) (VOD): The Market Decides If There Is a Bubble and When It Bursts, Not Statistics

Looking at Vodafone Group Plc (ADR) (NASDAQ:VOD) and its current position, I believe that it will be better off agreeing to the deal. Fortunately, investors know this. This explains why they are not letting go of Verizon Communications Inc. (NYSE:VZ). On the other hand, Verizon will also push relentlessly for the deal. The recent METROPCS COMM. DL-,0001 (FRA:PU9) deal with T MOBILE US INC (NYSE:TMUS) means more competition for Verizon. As such, increasing its control of key sectors of the industry remains a top priority. Although METROPCS COMM. DL-,0001 (FRA:PU9) has only 9 million subscribers, the support it will get from T-Mobile, now that the two are one, could impact Verizon negatively. The idea behind METROPCS COMM. DL-,0001 (FRA:PU9) and T MOBILE US INC (NYSE:TMUS) is to operate like one company under two brands. This may gnaw into untapped segments of the markets; segments that belong to Verizon. It is therefore very important that Verizon inks a deal with Vodafone.

Conclusion

Verizon’s uptrend is likely to hold for the next several months. And if the deal is successful, it could trend upward even further, pushing the stock into a whole new territory. Although it is trading close to 52-week highs, there is still more room for share price improvement. The rally hasn’t fully played out and it’s still not too late to get onto this ship.

The article The Market Decides If There Is a Bubble and When It Bursts, Not Statistics originally appeared on Fool.com is written by Lennox Yieke.

Lennox Yieke has no position in any stocks mentioned. The Motley Fool recommends Vodafone. Lennox is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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