Verizon: Out of the Doghouse and Into Your Dividend Portfolio

Key Points

• Verizon is the highest-yielding Dogs of the Dow stock for 2025, with a yield near 7%.
• Institutions are accumulating the stock and providing a solid support base, limiting downside risk.
• A CEO transition and an unused 100 million-share buyback authorization could become meaningful catalysts if cash flow keeps improving.

Verizon NYSE: VZ is 2025’s Dog of the Dow. The Dogs of the Dow list includes the index's top 10 dividend yields, which are expected to outperform the index over the subsequent year, according to popular theory.

On the official 2025 Dogs of the Dow list (ranked by dividend yield as of Dec. 31, 2024), Verizon sat at the top with a yield of about 6.8%.

Trading at a historically low valuation, Verizon is well-positioned to pay its dividend and deliver a market-beating advance in 2026, providing a double-digit total return for investors. 

The Dow Jones Industrial Average NYSEARCA: DIA is forecasted to advance by as much as 13% in 2026.

Tailwinds, including lower interest rates and tax relief for lower-income workers, are expected to drive healthy consumer spending and business investment, which, along with the AI trade, will support a broad market rally. 

Verizon is forecasted to rise by at least 17%, according to the 2025 year-end analyst consensus, with potential for an additional 20% at the high end of the target range. 

2026 Will Be Pivotal for Verizon

2026 is expected to be a pivotal year for Verizon’s business. The company has leaned heavily into cost-cutting, debt reduction, and investments in broadband and 5G over the past few years, and these efforts are paying off. Not only is Verizon on track to monetize its assets, but AI also provides avenues for improved efficiency, new business, and a more cost-effective structure. Improved and reliable cash flow offers strong support for the dividend and a favorable outlook for share buybacks. 

The company chose not to repurchase shares in 2025, instead focusing on reducing debt and enhancing cash flow.

As it stands, Verizon has ample buyback authorization in place, worth approximately 100 million shares, or about 2.4% of the outstanding share count. 

Another 2026 catalyst could be outperformance. Although Verizon is expected to widen its margins and drive growth in 2026, analyst forecasts are tepid. MarketBeat’s reported consensus calls for a low-single-digit revenue advance with slightly better earnings growth.

However, the forecast for 5G and Internet of Things (IoT), two areas where Verizon has shown strong performance, suggests much stronger growth rates.

Both are expected to sustain a mid-teens compound annual growth rate (CAGR) in 2026. 

Growth will be driven by subscribers and penetration, with IoT devices, edge computing, and autonomous/mission-critical technologies underpinning activity.

Additional catalysts for investors to watch in 2026 are the new CEO's efforts, ongoing business results, and capital returns.

Verizon: High-Yield Value Tracking for Inclusion in the Dividend Aristocrat Index

Verizon’s stock price and dividend yield offer an attractive risk-reward profile for investors. Trading near 8.5X earnings in late 2025, the stock is well below its 10-year average of 12X earnings, suggesting it may be undervalued.

Its dividend yield of nearly 7% is also above the long-running average, and the distribution is expected to grow. The company has paid dividends for decades and has increased its payment annually for 20 years. The 2026 increase puts it within four years of achieving Dividend Aristocrat status, another draw for buy-and-hold investors.

Institutions, the visible face of buy-and-hold investing, are accumulating VZ stock. The 2025 data show the total activity dwindling sequentially from Q1 to Q4, but quarterly activity remains above average in each period and is bullish on balance. The balance for 2025 ran above $2 bought for each $1 sold, providing solid support and a floor for price action.

Assuming this trend persists, VZ shares are unlikely to fall below $40 and remain there in the long term. It's more likely that VZ will continue to move within its established range, eventually retesting the high end and pushing to new highs by the end of 2026.