Stocks are mixed today, which isn't really bad news considering the overseas selloff we saw on Sunday night and early Monday morning.
Helping U.S. markets was decent news from the housing sector, where home sales were up 2.7% for September, with some of the country's hardest-hit regions like the southwest, showing the biggest gains. If the home-buying consumer can start chipping away at some of the home inventory out there, that could boost the economy at a time when we need it most. Overall, there are about 345,000 unsold homes sitting on the market. That number has to decline for the economy to get better.
On the technology side of the market, one seemingly recession proof stock appears to be Verizon. I've said that the telecom sector is one of the most resilient bear market survivors out there. People seem prepared to starve for a day or two rather than give up their Blackberries, and that is serving Verizon well.
Overall, the telecom giant, the company posted Q3 earnings of $1.67 billion, up from $1.27 billion this time last year. On a per share basis, the company met analyst expectations of $0.66. Their per-subscriber fee rate rose by 0.9%, meaning that customers are sticking to their phone plans.
Also, with its $28.1 billion purchase of Alltel, Verizon will be the undisputed global wireless services provider, making the company's bottom line even more impregnable. Verizon chief operating officer Dennis Strigl, in a conference call with analysts admitted that the company was losing some business because of the iPhone, but he didn't seem worried. “I’m not concerned about year over year churn (from Verizon's cell phones to the iPhone). We did see some churn to the iPhone from the quarter,” acknowledged Strigl. But Verizon Wireless has a “broadbased portfolio” and the company isn’t “wedded to any one iconic device," he added.
Strigl also said the company isn't seeing a serious fallout but there "could be" some pricing pressures down the road. Cushioning the blow was the news that Verizon added 1.5 million new customers for the quarter and Verizon Wireless had 70.8 million customers with 68.8 million retail customers, up 11.3 percent from 2007.
Some key numbers from Verizon's quarterly statement:
-- Verizon ended the quarter with 1.6 million FiOS TV customers, up from 700,000 a year ago. The company has 2.2 million FiOS Internet customers. But wireline revenue was $12.2 billion, down 1.7 percent from a year ago.
-- Verizon Business had revenue of $5.4 billion, up 1.2 percent from a year ago. Revenue from Internet protocol, managed services and Ethernet and optical ring services was $1.6 billion, up 15.4 percent from a year ago.
-- Sixty percent of Verizon’s Wireless customers had 3G devices. Verizon didn’t give an exact date to launch the Blackberry Storm
While Verizon saw its stock climb 5% after the earnings release the stock is still trading relatively cheap. I think it could be a good, solid pick for your portfolio going forward.