Bernstein Research has said that the wireline telecom performance will be “relatively worse” in 2009 as they expect slower wireless growth – and in response to that, they have downgraded the stock ratings on telecommunication giants Verizon and AT&T.
Verizon was downgraded from “market perform” to “underperform”, while AT&T was downgraded from “outperform” to “market perform”.
In a note to clients, analyst Craig Moffett said that they “believe the TelCo stocks have come too far, too fast. With strong Q4 outperformance, the sector has traded as a strong defensive/staple. But the sector is more appropriately viewed as a late-stage cyclical, in our view."