Moffett had an “underperform” rating for Verizon and a “market perform” for AT&T.
Moffett said the contracting wireline [land line] business is one of the factors for the decline.
“Although most people focus on the wireless business, when you buy a share of Verizon—because Vodafone owns 45 percent of the wireless business—what you’re getting is a company that is still more than half wireline and by cost, it’s about 65 percent wireline,” he said. “And structurally, that’s the business that faces enormous challenges.”
“[Verizon’s Fios numbers] were good numbers particularly coming into the second quarter because the second quarter is seasonally weak,” he said. “The whole video market is suffering from occupied house in the U.S. is contracting during the recession. You’ve got more kids moving back in with their parents and it’s tough to grow a business when the number of homes to serve is contracting.”
Analyst’s firm owns shares of Verizon.
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