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Jefferies and Bernstein Research each downgraded Verizon Communications ( VZ ) Thursday, citing a lack of near-term catalysts and valuation after shares in the high-dividend phone company jumped 17% during the first quarter. AT&T ( T ) stock rose 14% in Q1, as investors sought safety amid market turmoil and falling global interest rates. Shares of Verizon and AT&T have edged down in April. Verizon stock was down 2.3% on the stock market today , while AT&T was down 0.8%. Still, both have high IBD Relative Strength Ratings, with Verizon at 91 and AT&T at 90. That means both names have performed among the top 10% of all stocks over the past 12 months, with an emphasis on the most recent six months. “We are downgrading Verizon to market perform with a target price of 55, in light of this year’s (largely macro-driven) run-up in its stock price and a refresh of our (valuation) model to reflect recent developments, including fourth-quarter quarterly results, full-year 2016 guidance and last Friday’s close of its divestiture of wireline assets in California, Florida, and Texas to Frontier ( FTR ),” said Paul de Sa, an analyst at Bernstein, in a research report. Frontier Communications paid $9.9 billion for those wireline assets and also took on $600 million in debt. Verizon is due to report earnings April 21; AT&T follows on April 26. “We are downgrading Verizon from buy to hold, but maintain our 53 price target,” Jefferies analyst Mike McCormack said in a report. “Although we continue to believe Verizon is well positioned in the industry long-term, we don’t believe near-term catalysts exist to provide upside to either our estimates, or our view on valuation.” Image provided by Shutterstock . Scalper1 News
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