Heading To The Top – Verizon Communications Inc (NYSE: VZ) and AT&T Inc (NYSE: T)

By the end of today, both Verizon Communications Inc (NYSE: VZ) and AT&T Inc (NYSE: T) are due to release their third quarter earnings per share report.

Verizon’s EPS are just under 24% higher than its EPS exactly a year ago. This growth is mainly due to the $130 billion acquisition of the stake that Vodafone PLC (NASDAQ: VOD) held in the cellphone provider.

As for AT&T, the company expects to report EPS of $0.64, which is a decrease of 4.5% from the third quarter last year. Investors hope the company will recuperate their losses with its planned acquisition of DirectTV, a satellite television provider. AT&T supposedly offered $45 billion for the company.

Both companies are facing fast growing competition from Sprint Corp. (NYSE: S) and T-Mobile USA Inc. (NYSE: TMUS). It appears that Verizon has held up better to the increasing pressure, due to the fact that it had gained an additional 1.4 million subscription customers within the second quarter. The company also has made extremely strong growth in the sales of tablets as well as in the sale of smartphones.

The company has also reported second quarter earnings of $1.01 per share and a revenue of $31.5 billion. Last year, Verizon reported second quarter earnings of $0.78 per share and revenue of $29.8 billion. This year’s second quarter report exceeded Wall Street’s expectations, who had estimated a profit of $0.90 per share and revenue of $31.12 billion. However, net income fell from $5.2 billion to $4.3 billion.

The Chairman and CEO of Verizon, Lowell McAdam, said in a statement that Verizon’s second quarter performance is an indication of the company’s ability to achieve strong customer growth and financial results in a highly competitive market. The company’s second quarter results provide a great momentum heading into the second half of the year.

AT&T, on the other hand, added over 2 million new subscribers to its wireless and wireline services in the first quarter, but has not released its second quarter results. Analysts agree that their silence suggests that the results were not impressive.

Ever since releasing its first quarter results, AT&T’s stock price has dropped a few cents from $36.39 to $37.17.

In terms of estimated revenue growth, Verizon takes the lead with 4.5%, compared to AT&T’s growth of 3.7%.

Verizon’s shares rose from $46.28 first quarter to $50.75.