The recent outages suffered by customers of communications stock Verizon (VZ) are proving to be worse news for the company than first glance suggested. The cause of the outage was uncovered, and with it, customers responded to the promise of a $20 credit for the outages suffered. Both of these factors together proved to be a drag on shares, and Verizon shares slipped fractionally in Friday morning’s trading.
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The outage ran about 10 hours in total, reports note, and hit hundreds of thousands of customers. It was Verizon’s first major outage in over a year—the last one was in October 2024—and hit both text and voice calling, unless data use was involved.
But the cause was eventually pinned down and blamed on a “software issue.” Verizon issued an update that seemed to resolve the whole thing, and Verizon also noted that a “cyber security issue” was really not to blame here. At least, there were no indications that was the case. Verizon then offered customers a $20 credit to make up for the day they spent without service, but that did not sit well with a lot of customers.
A Paltry Reward
Indeed, customers took issue with the $20 credit, with some subscribers calling the credit “pathetic.” Even lawmakers got involved, as Sen. Ben Ray Lujan (D-New Mexico) started work on legislation that would require “pro-rated refunds” by law. Lujan noted, “If you pay for a service, that’s what you should be getting.”
Verizon, for its part, noted that no credit can really make up for what happened, and the credit would actually account for “…multiple days of service.” Though, by the numbers, Verizon is likely correct here—the Unlimited Welcome plan is $65 a month, reports note, so $20 would basically give back over a week’s worth of service—Verizon is hard-pressed to account for stories like those of customers unable to reach 911 in an emergency.
Is Verizon Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on VZ stock based on four Buys and nine Holds assigned in the past three months, as indicated by the graphic below. After a 1.5% rally in its share price over the past year, the average VZ price target of $46.55 per share implies 19.21% upside potential.
