Despite comments from Verizon CEO McAdam, analysts don't see Big Red buying Disney or CBS
Last week, Verizon announced that it lost 289,000 postpaid phone subscribers during the first quarter. While things turned around after Verizon Unlimited was launched in February, most analysts were not impressed. For example, Craig Moffett from MoffettNathanson said that "Verizon missed. On almost every metric." The analyst added that the poor report could put some pressure on Big Red to top their previous purchases of AOL and Yahoo.
Even before the earnings release, Verizon fanned the acquisition fires when CEO Lowell McAdam said that his company would be open to a merger with Disney, Comcast or CBS. Moffet says that despite McAdam's comments, Verizon isn't really keen on chasing CBS or Disney, and purchasing Comcast is probably out as well.
Verizon still needs to digest its $4.48 billion purchase of Yahoo and 2015's $4.4 billion acquisition of AOL. Earlier this month, the nation's largest carrier introduced a new division called Oath, which will combine assets from the two companies. Oath will consist of 20 brands with 1 billion customers, and will launch this summer.
Wells Fargo's Jennifer Fritzsch sees Verizon working on getting its recent acquisitions to mesh together rather than spending billions on adding another company to the mix. While she says that talk of Verizon spending billions on a new M&A purchase is "overblown," if the wireless business doesn't pick up soon, all bets are off.