Large-cap tech and telecom stocks rallied on Wednesday, with one exception: Verizon.
As the Nasdaq Composite Index popped 1 percent at the close, Verizon sunk 2.7 percent following a downgrade from Morgan Stanley and the news that it will take a $4.6 billion charge for its failing media business, Oath.
Verizon made public the hefty goodwill impairment charge Tuesday in its 8-K filing, acknowledging the business turned out to be less valuable than initially expected.
"Verizon's Media business, branded Oath, has experienced increased competitive and market pressures throughout 2018 that have resulted in lower than expected revenues and earnings," according to the filing. "These pressures are expected to continue and have resulted in a loss of market positioning to our competitors in the digital advertising business."
On Wednesday morning, Morgan Stanley analyst Simon Flannery wrote in a note that Verizon was priced at a premium and believes growth will slow next year since it has already made investments toward becoming the first 5G carrier.
Verizon's latest news follows an announcement Monday that more than 10,000 employees accepted its buyout offer, which represents about 7 percent of its global workforce. The company is working toward its goal of saving $10 billion in cash by 2021.
Meanwhile, Verizon competitor AT&T closed the day up 1.6 percent. Several other stocks valued over $100 billion soared on Wednesday. Netflix and Broadcomm were the strongest performers, up 3.6 percent and 3.3 percent, respectively. Even Facebook, which has been beaten down over the past few months, was up 1.7 percent, while Apple closed up 0.3 percent.
