The Motley Fool Take Calling Verizon

Telecom company Verizon Communications (NYSE: VZ) is an intriguing option for income-seeking investors. Like most investments, it’s not perfect: It’s saddled with $113 billion in debt, thanks in part to the capital-intensive needs to build and constantly improve communications infrastructure. Purchases of now-struggling assets from AOL and Yahoo! a few years ago didn’t help the balance sheet, either.

But in today’s economy, wireless connectivity is a basic staple. Despite the ongoing pandemic, Verizon’s operating revenue fell only 3% during the first half of 2020. The company is also acquiring prepaid wireless specialist TracFone, which will bring in millions of new customers to whom Verizon can cross sell other products and services.

Verizon stands to benefit from the growth of markets for 5G, the latest global wireless standard. The company’s Ultra Wideband network is already available in parts of dozens of cities, with many more on the way.

Its new-and-improved technology promises “seamless 4K streaming” along with “ultra-low lag on all your connected devices.”

Verizon’s dividend recently yielded a substantial 4.4%, and that payout seems safe, at only 56% of recent annual earnings. The company has ample room to continue making network improvements and service debt, while rewarding owners of its stock generously. Don’t expect any sizzling stock price performance from Verizon, but this slow-and-steady telecom business is still worth owning. (The Motley Fool has previously recommended Verizon Communications.)