Verizon Communications Inc. (NYSE: VZ) shares fell on Monday January 23 on lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.
Meanwhile, U.S. stocks flipped between small gains and losses in early trade on Monday.
The Dow Jones Industrial Average DJIA, -0.14% was off by 13 points, or less than 0.1%, at 19,815, with McDonald’s Corp MCD, -0.99% and General Electric CoGE, -0.95% leading the losses, down more than 1%.
The S&P 500 SPX, -0.18% slipped 2 point to 2,270, with five of the main sectors trading lower. The Nasdaq Composite COMP, -0.09% gained 4 points to 5,558.
Shares of Verizon Communications Inc. (NYSE: VZ) were downgraded by analysts at Wells Fargo & Co. in a note to their investors today. With a rating of Market Perform on the shares, the company has a 52-week high of $56.95. The one-year price target of $53.41 is higher than the opening price of $52.46, causing a number of other analysts to issue statements on the company recently. Material and fundamental changes in the company’s actions, future outlook or industry can cause downgrades as the analysts believe that the future prospects for the security have diminished from the original recommendation.
Yesterday Verizon Communications Inc. (NYSE: VZ) shares last traded at $52.48, a decrease of $0.25 over the previous closing price. Opening at $52.46, they fluctuated from $52.45 and $52.70 throughout the day.
Verizon Communications Inc. (NYSE: VZ) currently has a market cap of 213.92B.
Verizon Communications Inc. (NYSE: VZ) Average Daily Trading Volume
1,575,176 shares traded hands yesterday, 38 percent below the average, out of a total float 4,060,368,000. lower than normal. Look for trading volume to pick up in the coming days as investors often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.
As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.
Institutional sponsorship commonly refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.
These professional investors have substantial teams of analysts researching thousands of stocks, so it is good validation to see them taking a postion in a stock you’re considering.
Verizon Communications Inc. (NYSE: VZ) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
By tracking the activity of these professional investors—and the moving averages they affect—it allows for traders to make more effective decisions on trades.
With that in mind, Verizon Communications Inc. (NYSE: VZ) now has a 50-day MA of $52.56 and 200-day MA of $51.92. It has traded in a 52-week range between $46.01 – 56.950 and today’s last price is 7.86%% lower than the 52 week high of $56.95.
Indeed, earnings growth is among the most critical things to look at in regards to stock investing and, accordingly, investors identify companies that have been successful at growing their earnings at least 25% or more for the past 3 years.
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