You may be in for a shock when you see that Verizon (VZ) is trading around $41 and has been struggling on the market lately. Furthermore, this is in the midst of its decision to purchase Hughes Telematics for the grand price of $612 million. Verizon hopes this acquisition will help it reach a wider customer base, as Hughes Telematics focuses on GPS tracking and other features in terms of car safety. This will not take place until much later in the year, however, so this may help explain why the stock has not benefited from this move.
With the purchase, investors may also be concerned by the fact that the purchase is not even safe yet. Rigrodsky & Long, P.A. is investigating the whole buyout of Hughes Telematics by Verizon for possible breaches of fiduciary duties and other law violations. Investors hope that this ends up being nothing other than someone going after a non-existent issue with no real basis. Whether or not these claims have a basis, however, there is still reason for concern, as the potential trouble may drive away some investors and hurt the stock.
Before investigating Verizon’s situation more thoroughly, it is worthwhile to look at its competitors and their presence in the market recently.
USA Mobility (USMO) has people wondering if it will fizzle out, as reports claim that dividend yields will likely drop soon. Even if there seems to be a margin and people are buying, investors should pay attention to this change in sentiment. People may soon begin to lose confidence in this stock. To continue reading, click here.