“Uncertainty” is a buzzword that’s been front and centre of all financial debates in recent weeks as the Trump administration announced new tariffs to set into motion a series of events that are now evolving into a full-blown trade war.
Against such a challenging macroeconomic backdrop, the benchmark S&P 500 index, at one point, was even seen trading some 20% below its year-to-date high.
Still, Bank of America analysts talked of a few “defensive” spots within the telecom industry that they’re convinced could offer some protection against tariff uncertainty in 2025.
Two of these names are Verizon and SBA Communications.
Verizon Communications Inc (NYSE: VZ)
BofA strategists remain bullish on Verizon stock amidst ongoing macro uncertainty as it has a history of “demonstrating propensity to outperform the S&P 500 index in down-tapes.”
VZ’s year-to-date performance is evidence of that propensity. Shares of the telecom giant are currently up well over 10% versus their low in early January.
On top of continued outperformance, Verizon pays a rather lucrative dividend yield of 6.47% at writing, which makes it all the more exciting to own in 2025.
According to the investment firm, VZ is a defense name with a domestic skew that will help keep it relatively insulated from how tariffs and the trade tensions evolve.
Last week, Verizon reported better-than-expected profit for its fiscal Q1.
The wireless and home internet company earned $1.15 on a per-share basis, well above the $1.09 a share that experts had forecast.
The rest of Wall Street agrees with Bank of America on VZ shares, given the consensus rating on the NYSE-listed firm currently sits at “moderate buy”.
SBA Communications Corp (NASDAQ: SBAC)
Much like Verizon, this real estate investment trust (REIT) that owns and operates wireless infrastructure in the US also tends to outperform the S&P 500 index during downturns.
Plus, it’s a dividend stock that currently yields 2%, which makes it suitable for this year, given the tariffs are now brewing concerns of a recession ahead.
In fact, tower stocks could prove to be a safe haven amidst the ongoing uncertainty, according to the Bank of America analysts.
SBAC may be worth owning at current levels as it has most of its business based in the US.
The company based out of Boca Raton, FL, is scheduled to report its financial results for the first quarter on April 28th.
BofA is positive on the REIT even though it’s expected to report $2.95 a share of AFFO for Q1, down more than 10% on a year-over-year basis.
Despite expected weakness, other analysts agree with the Bank of America as well, given the consensus rating on SBA Communications currently sits at “overweight”.
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