In today’s world of working from home and learning remotely, everyday individuals like you and me may be more reliant than ever on telecommunication providers. One may think these circumstances would be good news for investors and traders in telecom stocks, but the picture is decidedly mixed.
For instance, just yesterday JP Morgan telecom financial analyst Philip Cusick cut his rating on AT&T to neutral from overweight, trimming his target price on the stock to $35 from $38.
Cutsick believes AT&T will keep paying its generous 7.2% dividend yield, but noted that AT&T has suspended its share-repurchase program. Custick, now believes a telecom competitor with a stronger balance sheet offers a better return on risk.
That competitor is Verizon (NYSE: VZ), and they may even be your telecommunication provider. Just yesterday, Cutsick stated that Verizon is the most attractive telecommunication stock in its respective sector.
Moments after Cutsick maintained his buy rating on Verizon, he cut his ratings on telecommunication sector competitors including AT&T, Comcast and CenturyLink.
But here’s where having an expert trader on your side makes Cutsick’s stance on Verizon actionable to today’s trading session…
Given current market volatility, while Verizon does indeed possess a bullish catalyst of being superior to its competitors in the telecommunication industry, according to JP Morgan, this stock could actually be traded to the upside and the downside for profit today.
Shown in green in the chart above is Verizon’s 20-day simple moving average line. I’ll be watching to see if Verizon remains trading above this key support level to make a potential bullish trade on Verizon, pay myself by the end of the day, and rest easy at night in all cash.
Inversely, should Verizon trade below its 20-day simple moving average line and make a green-to-red move along with markets, I’ll simply short Verizon to the downside as a momentum-based trade and exit my position by the end of the day, ideally for a profit.
I expect the fat pockets on Wall Street to be actively trading, investing in, or hedging Verizon in the hours, days and weeks ahead. As a clear standout in the high demand telecommunication industry from both a technological and balance sheet point of view, Verizon may be perceived by financial professionals as a company with impressive sales and demand right now, despite the stock market’s general decline.
Yours for TrackStar trading,
America’s #1 Premarket and Day Trader
Disclaimer: This is not investment advice. This article is for information purposes only and opinion-based on financial advisor data across a selection of websites. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions.