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Verizon Go90 Off To ‘Slow Start,’ Says UBS, Based On Apple Store

The Verizon Communications ( VZ ) Go90 mobile video service is off to a slow start, says a UBS report, based on a study of app downloads at the Apple ( AAPL ) iOS store. The Go90 mobile video service — ad-supported and free to users — launched in late September, targeting millennials (adults ages 18 to 34) and gen Zers (teens). “Go90 appears to be off to a slow start, with its best showing around No. 300 when ranked against all apps in the iTunes store and No. 20 when ranked against other entertainment apps,” said the UBS report. Verizon’s Go90 is usually lumped with emerging over-the-top (OTT) video services, such as Dish Networks ’ ( DISH ) Sling, but the mobile app also competes for millennial attention with the likes of YouTube, Facebook ( FB ), Instagram and Snapchat, says UBS. “We believe Go90 will be hard-pressed to mount a meaningful challenge to mobile video and social networking leaders YouTube, Facebook, Instagram, Snapchat, Netflix ( NFLX ) and Hulu,” wrote UBS analyst John Hodulik in the report. “That said, Verizon is pulling various levers to ramp up interest in and usage of Go90, including more live and exclusive content and free data for Verizon Wireless customers.” One Verizon challenge is that Facebook and  Alphabet ’s ( GOOGL ) YouTube garner the most mobile ad revenue. UBS studied downloads at Apple’s iOS store. “While downloads do not reflect app usage and engagement, we believe the two metrics are highly correlated in the medium to long term,” said the report. Verizon has not disclosed Go90 subscriber data. The service is not expected to be profitable for a few years. Go90 offers a mix of original Web TV series, live sports, concert streaming, prime-time TV and other short-form content. “Initial download trends suggest Go90 is doing better within the iPhone base relative to other entertainment applications, but appears to be lagging in the iPad market. This supports our view that the product is seen as a truly mobile service more geared to short-form content,” wrote Hodulik. Verizon stock was down a fraction in morning trading in the stock market today , above 52 and within range of a 51.30 buy point first touched Feb. 25. Verizon ranks No. 4 in the most recent IBD Big Cap 20. Image provided by Shutterstock .

Frontier Downgraded By Citi On Post-Verizon-Deal Synergies

Citigroup downgraded Frontier Communications ( FTR ) saying synergies expected from its acquisition of residential lines in three states from Verizon Communications ( VZ ) may fall short of consensus estimates. Verizon’s sale of wireline assets in California, Florida and Texas for $10.5 billion to Frontier is expected to close by March 31. Verizon, No. 4 on the latest IBD Big Cap 20 list of top-performing big-cap stocks, is aiming to strengthen its balance sheet ahead of an auction of radio spectrum controlled by local TV stations, which is slated to begin this month. Verizon, which acquired AOL last year for $4.4 billion, also has stated interest in acquiring parts of Yahoo ’s ( YHOO ) Internet business. Citigroup analyst Michael Rollins on Wednesday lowered his rating on Frontier to sell from neutral. “We are lowering our pro-forma OIBDA (operating income before interest tax, depreciation and amortization) outlook for Frontier,” wrote Rollins. “Our study of the company’s last two acquisitions suggests net synergy realization is much lower than the guided gross synergy figures. We do not think the emerging consensus is discounting the guided synergy contributions enough.” Frontier stock was up 21% in 2016 through Tuesday, though it has a mediocre IBD composite rating of 68. But shares were down more than 5%, near 5.30, in early trading in the stock market today . AT&T ( T ), No. 2 on the IBD Big Cap  20 and an IBD Leaderboard stock, is the highest-rated phone company in IBD’s Telecom Services-Integrated group. AT&T’s cash flow has been bolstered by its acquisition of satellite TV broadcaster DirecTV. Frontier will assume $600 million in debt as part of the deal Verizon deal, involving former GTE assets in California, Florida and Texas. In 2010, Verizon sold Frontier 4 million phone lines in 14 states for $5.3 billion. Frontier in 2013 acquired AT&T’s wireline assets in Connecticut for $2 billion in cash. Both AT&T and Verizon have been shedding residential lines as well as noncore assets such as cellphone towers. Verizon stock was up a fraction in early trading Wednesday, near 53 and within range of a 51.30 buy point first touched Feb. 25. Image provided by Shutterstock.

How Are Major Car Stocks Looking Vs. Tesla Motors?

Going into Wednesday trading,  Tesla Motors ( TSLA ) stock is up for the week, despite giving back 1.3% Tuesday while the S&P 500 index slumped 1.1%. Electric car maker Tesla and other automakers have been chugging back from February lows, with none highly rated by IBD and only Tesla, Ford ( F ) and Nissan ( NSANY ) much at all above their key 50-day moving averages, among major names. IBD’s Auto Manufacturers industry group fell 1.6% on the stock market Tuesday but it’s up 37% over the last month to around where it was two months ago. Ferrari ( RACE ) raced above its 50-day line Tuesday, with the October IPO gaining 1.5% after a 2.2% lift Monday. It was the only one of 15 automakers tracked by IBD to advance Tuesday — the others fell between about 1% and 5%.  General Motors ( GM ) remains above the line but close to it after its 2.9% drop Tuesday. Ferrari is still far down from its IPO price of 52, closing Tuesday at 41.22. Fiat Chrysler ( FCAU ) and Ford have the best IBD Composite Ratings among auto manufacturers now, but they’re not hot — just in the low 50s out of a possible 99. Those two car manufacturers reported surging sales for February while the broader car industry’s unit sales eased to an annualized rate of 17.54 million, below forecasts and under January’s annual pace of 17.58 million, according to Autodata. Geneva International Motor Show-Offs At home in the U.S., this is what’s going on with Tesla now : It’s counting down to its late-March Model 3 reveal. Its stock is being targeted by a short-seller. A rumored new Model S version might go 300 miles between charges Meanwhile over in Switzerland, Tesla took its Model X to the Geneva International Motor Show that runs March 3-13. Wingmen @gims_live #GenevaMotorShow pic.twitter.com/SPMcXz1Qyo — Tesla Motors (@TeslaMotors) March 3, 2016 Ferrari introduced its GTC4Lusso, among other debuts. Volkswagen ( VLKAY )-made supercars by the Bugatti and Lamborghini nameplates absorbed some of the limelight. Take a look at #Ferrari 's show-stealing stars at the #GIMS . #GTC4Lusso #CaliforniaT #TailorMade #HS #488GTB https://t.co/HRvEnsk6WL — Ferrari (@Ferrari) March 3, 2016