Verizon Communications (NYSE:VZ) — Earnings are expected to increase to $2.50 next year from $2.23 in 2011, and strong operating margins and network quality are expected to attract customers to its 3G and 4G networks.
The communications sector has been one of the strongest in the later months of this year, and VZ has been a leader of the group. But the sector, and VZ, may have run too far too fast. Less buying and a short-term sell signal from its stochastic warn that a correction is likely.
Buy Verizon on a pullback under $38 for a longer-term advance to the high $40s.
