The Sunday Brief

Connecting technology, telecommunications, and the internet

Value Creation – Long-term charts, Fab Five vs. Telco Top Five (Jan 20)

by | Jan 21, 2024 | TSB

This week featured strength from the Fab Five (+$241 billion wk/wk and +$709 billion the last two weeks) and also from the Telco Top Five (+$10 billion wk/wk with each Telco Top Five stock up vs the Jan 12 close).

A mere $16 billion (out of nearly $3 trillion) separates market leaders Apple and Microsoft. T-Mobile remains the Telco Top Five market cap leader. Verizon, as we noted in last week’s Brief, is making progress towards overtaking Comcast. Both companies announce earnings this week.

Speaking of earnings calendars, we have included the latest earnings calendar as a tab in the value creation file attached to this post (as well as nearby). We have also filled in Microsoft’s and Amazon’s earnings dates and have included links to their conference call webpages.

Verizon announced through this SEC filing that they would be taking a $5.8 billion writedown in their business wireline business. We noted in a LinkedIn post that is was slightly more than the sum of the AOL + Yahoo! + Bluejeans purchases. We anticipate that they will add some color to this on Tuesday’s earnings call, but likely has to do with electronics purchases and systems development for products and services that did not grow as anticipated.

Separately, several news outlets (CNET article included here) that Verizon is going to be raising prices on residential postpaid wireline customers by $4/ line/ mo. This is going to impact willingness to investigate other carrier options and likely good news for T-Mobile and AT&T (and, to a lesser extent, cable business offerings). We are confident that Verizon anticipates some churn as a result, but wants to get current customers pointed to their new myPlan platform. Since this “price up” impacts popular plans (5G Get More, 5G Play More, 5G Do More and 5G Start unlimited), the upside could be material.

The file below also includes the primary and secondary data behind the 10-year returns post from January 1. Next week, we will have plenty of earnings commentary and also summarize the (positive) reaction to Samsung’s latest product reveals.

Have a great week and GO CHIEFS!

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