Verizon Communications Inc.

A: NeuLion Inc., $0.64, symbol NLN on Toronto (Shares outstanding: 282.0 million; Market cap: $180.4 million; www.neulion.com), is an online video technology company headquartered in Plainview, New York. It takes the live feed of content providers and encodes and edits it....

Dear Client:

AT&T and Verizon face strong competition in their wireless and Internet businesses, and both have used acquisitions to enhance their services and attract new subscribers. Expanding this way adds risk, but we feel those new businesses will spur long-term earnings for each company and provide more cash for dividends.

AT&T INC....

AT&T INC. $42 (New York symbol T; Income-Growth Dividend Portfolio, Utilities sector; Shares outstanding: 6.1 billion; Market cap: $256.2 billion; Dividend yield: 4.7%; Dividend Sustainability Rating: Highest; www.att. com) is the largest wireless carrier in the U.S....

Investing in high-quality U.S. telecoms such as AT&T and Verizon gives Canadian investors two main advantages.

First, the U.S. market is much larger than Canada, so there’s still lots of room for these firms to keep expanding their wireless subscriber base....

The U.S. is poised to loosen rules for telecommunication companies that should create growth opportunities for both AT&T and Verizon.

More specifically, those industry leaders should be better positioned to develop and sell new, more-profitable Internet plans....

VERIZON COMMUNICATIONS INC. $47 (New York symbol VZ, Income Growth Dividend Payer Portfolio, Utilities sector; Shares outstanding: 4.1 billion; Market cap: $192.7 billion; Price-to-sales ratio: 1.5; Dividend yield: 4.9%; Dividend Sustainability Rating: Highest; www.verizon.com) has 113.7 million wireless users, 14.2 million landline phone clients and 15.6 million high-speed Internet and TV subscribers.


With the November 2016 payment, Verizon increased its quarterly dividend by 2.2%, to $0.5775 a share from $0.565....

Demand for wireless and TV services has slowed at both AT&T and Verizon. To spur long-term earnings, the two are buying firms that complement their main businesses. These acquisitions add risk, but we feel they will ultimately pay off with more cash for dividends.

AT&T INC....

VERIZON COMMUNICATIONS INC., $50.92, New York symbol VZ, rose 2% this week after the company negotiated a new four-year contract with the union representing 36,000 customer service representatives and network technicians. That ended a seven-week strike.

Under the deal, these employees will receive an 11% wage hike over four years....

MACY’S INC., $43.43, New York symbol M, operates 885 Macy’s and Bloomingdale’s department stores and sells goods online. The company earned $544 million in its fiscal 2016 third quarter, which ended January 30, 2016. That’s down 31.4% from $793 million a year earlier. Per-share earnings dropped 23.5%, to $1.73 from $2.26, on fewer shares outstanding. Macy’s earned $2.09 a share in the latest quarter, if you exclude charges related to the company’s plan to close 35 to 40 of its stores in the next few months. The result beat the consensus estimate of $1.89....

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WAL-MART STORES INC., $62.68, New York symbol WMT, is closing 269 of its less profitable stores; it currently has 11,600 outlets worldwide.

Of the total, 154 will be in the U.S., including all 102 of its smaller Walmart Express locations....