The Zacks Analyst Blog Highlights: Verizon Communications, Vodafone Group, AT&T, Sprint and Apple

Dec 13, 2013, 09:30 ET from Zacks Investment Research, Inc.

CHICAGO, Dec. 13, 2013 /PRNewswire/ -- announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Verizon Communications Inc. (NYSE: VZ-Free Report), Vodafone Group plc (Nasdaq: VOD-Free Report), AT&T, Inc. (NYSE: T-Free Report), Sprint Corp. (NYSE: S-Free Report) and Apple (Nasdaq: AAPL-Free Report).


Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Thursday's Analyst Blog:

Verizon to Settle Investor Lawsuit

According to news reported by Bloomberg, leading telecom carrier,Verizon Communications Inc. (NYSE: VZ-Free Report) has agreed to settle a pending lawsuit against its $130 billion deal with Vodafone Group plc (Nasdaq: VOD-Free Report) to acquire its 45% stakes in Verizon wireless. The lawsuit was filed by investor Natalie Gordon in New York State Supreme Court with the aim of obstructing this deal. Following the Federal Communications Commission (FCC) approval, Verizon's eagerness to settle disputes that may hamper successful completion of this deal is a positive sign. Thus, we remain hopeful of the deal's closure in the stipulated first quarter of 2014.

On Dec 6, both the parties involved in the lawsuit signed a memorandum to settle the dispute, which has been filed in the court this week. This settlement is now awaiting the green signal from court. Verizon is currently looking forward to its shareholder's meeting on Jan 28. Apart from a vote in favor of the acquisition, the company expects its shareholders to pass the issuance of as many as 1.28 billion shares to complete the deal.

For Verizon, the total buyout of its wireless business would mean saving a substantial amount of the payment that slips into Vodafone's pocket. Verizon Wireless, with operating income over $21 billion not only remains a key driver of Verizon Communications' earnings, but also provides a competitive edge over big names like AT&T, Inc. (NYSE: T-Free Report) and the rapidly growing Sprint Corp. (NYSE: S-Free Report).

This deal is touted to be one of the biggest in the telecom space after Vodafone's acquisition of Germany's Mannesmann AG in 2000 (for approximately $142 billion) and Time Warner Inc.'s merger with AOL (for $124 billion) in 2001. We believe the complete takeover of its wireless business would translate into greater synergies for Verizon, which already holds a significant place in the U.S. wireless market.

Verizon currently has a Zacks Rank #3 (Hold).

Apple Wins Suit in South Korea

Apple (Nasdaq: AAPL-Free Report) won a decisive victory against Samsung in South Korea, after the Seoul Central District Court dismissed a patent infringement lawsuit filed by the latter. The court ruled that Apple's iPhone 4S, iPhone 5 and iPad 2 did not violate Samsung's three mobile patents.

This is the third consecutive win for Apple against Samsung within a short span of time. In November, a U.S. jury ordered the South Korean company to pay $290.0 million as damages to the iPhone maker.

In a separate case, the U.S. Court of Appeals ruled that Judge Lucy Koh should reconsider Apple's request for a U.S. ban on 26 Samsung products that were found guilty of infringing patents. The appeals court ruled that out of the six infringed patents, three qualified for calling a ban on Samsung products.

Samsung filed the case in Mar 2012 in Seoul's District Court, alleging that Apple has violated its intellectual property related to short message services in smartphones and tablets. The company demanded Won 100 million as fine and also requested the court to ban of six Apple products.

However, the court found that one of the allegedly violated patents was not at all used by Apple in any of its devices, while the other two can be developed easily from other inventions. The court scrapped Samsung's ban request and the compensation claim.

We believe that this is a sound victory for Apple in Samsung's own backyard. To date, Apple had a mixed luck in this Seoul court, where it was fined Won 40 million in 2012, for violating Samsung's two patents related to wireless technology.

In the same case, the court fined Samsung Won 25 million for infringing patent related to the bouncing-back function, used at the time of navigating electronic documents.

Apple has won more than $900.0 million in damages from Samsung. However, the legal fight between the two companies does not end here, as Samsung plans to challenge the U.S. jury's retrial verdict. Moreover, both are scheduled to meet in court in Mar 2014 in a new trial for examining more recent smartphones including iPhone 5 and Galaxy S3.

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