Is Verizon Communications a Good Dividend Stock to Buy Now?

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VZ’s $2.56 annual dividend yields 5.01% at the current share price. On December 2, the company declared a 64-cent quarterly dividend, the same as the previous quarter, payable on February 1, 2022. VZ’s dividend payouts have increased at a 2.1% CAGR over the past three years. The company has a record of eight consecutive years of dividend growth. “Our disciplined strategy and execution continue to create short- and long-term value for our shareholders,” said Hans Vestberg, VZ’s Chairman and CEO.

VZ recently announced the acquisition of TracFone Wireless, Inc. and TracFone’s family of brands, aiming to strengthen its wireless network. However, the acquisition led to a $3.13 billion cash payment along with 57,596,544 shares of Verizon stock. The deal also requires an additional $650 million cash consideration. Considering the company’s negative $24.47 billion trailing-12-months levered free cash flow, the acquisition, along with the company’s venture into C-Band spectrum for 5G wireless, could hamper its cash position. Furthermore, VZ reported declining cash flow from operating activities in its latest financial report.

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