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If you’re seeking a reliable way to generate steady income from your investments, high-yield stocks with a strong history of dividend growth can be smart options. Companies with stable earnings and resilient payouts are mostly the ones that consistently pay and increase their dividends, making them dependable long-term investments.
In this context, Verizon (VZ) emerges as a top choice. It has a proven history of dividend payments and growth. Moreover, it offers a high yield of over 6%. Further, the company is poised to benefit from artificial intelligence (AI)-driven demand, which will accelerate its growth, expand its earnings base, and support its future dividend payouts.
Verizon’s Robust Dividend History
Verizon is a go-to stock for income investors, thanks to its robust track record of consistent dividend growth. The communications and technology giant has raised its dividend for 18 consecutive years, reflecting its commitment to rewarding shareholders. Currently, Verizon offers a quarterly dividend of $0.6775 per share, translating to a solid forward yield of 6.3%.
Verizon’s ability to generate reliable revenue from its wireless services while effectively expanding adjusted EBITDA and maintaining strong free cash flow supports its payouts. This financial stability ensures that the company can sustain and grow its dividends over time.
Verizon’s wireless service revenue continues to show remarkable consistency. The business has witnessed sequential growth in the past 18 consecutive quarters. In the fourth quarter of 2024, the company reported total wireless service revenue of $20 billion, reflecting a 3.1% year-over-year increase. This growth was due to higher pricing, increased sales of premium add-on services, and the growing adoption of fixed wireless access. Moreover, the company reported free cash flow of $19.8 billion for 2024, up from $18.7 billion in the previous year.
Verizon’s solid financial footing suggests it could continue growing its dividend.
Strong Market Position and Expansion Strategies
Verizon continues to solidify its position as a leader in wireless technology, leveraging its dominance in 4G and 5G to maintain a competitive edge. By consistently investing in network enhancements, the company ensures top-tier connectivity and service quality, attracting more customers and driving financial growth.
The company’s recent performance underscores its strong market position. In the fourth quarter of 2024, Verizon added nearly 1 million postpaid customers across its mobile and broadband platforms — the highest quarterly gain in over a decade. Moreover, postpaid mobility grew significantly, with 568,000 net phone additions during the quarter.
In broadband, Verizon continues to take market share and delivered 408,000 net adds in Q4. Fixed wireless access contributed 373,000 net adds, while Fios expanded by 51,000 subscribers.
Looking ahead, Verizon is taking steps to expand its reach and accelerate growth. A key move is its pending acquisition of Frontier (FYBR), the leading fiber internet provider in the U.S. This acquisition will significantly boost Verizon’s fiber infrastructure, allowing the company to offer even faster, more reliable broadband services. Additionally, it positions the company to explore emerging opportunities in AI and the Internet of Things (IoT), industries poised for significant expansion.
AI to Accelerate Verizon’s Growth
The rapid adoption of AI-driven technologies is fueling demand for high-speed, low-latency network infrastructure. In response, Verizon has launched Verizon AI Connect — a comprehensive suite of AI solutions designed to help businesses scale their AI workloads efficiently.
As enterprises increasingly depend on real-time AI inferencing for critical decision-making, Verizon is leveraging its expansive 5G network, high-speed fiber connectivity, and advanced edge computing capabilities to meet these evolving needs.
With hyperscalers, cloud providers, and enterprises seeking secure, high-performance AI infrastructure, Verizon’s strategic investments position it as a key player in AI deployment. Its robust network is built to support the growing demand for AI-powered applications, enhancing the company’s long-term growth prospects.
Verizon Stock: Investment Outlook
Wall Street analysts rate Verizon stock as a “Moderate Buy.” Verizon’s ability to generate strong free cash flow, maintain a high dividend yield, and consistently return higher cash to its shareholders make it an attractive investment for investors seeking steady income.
Further, Verizon’s leadership in wireless and broadband services and expansion into AI and digital solutions strengthens its long-term growth potential. Overall, Verizon is a compelling investment for investors seeking a high-yield dividend stock with exposure to AI-driven opportunities.
