Hello. It’s Verizon calling to let you know it’s our world now, and you’re just living in it.

Today, the telecommunications giant announced it’s acquiring Frontier, the largest pure play fiber broadband internet provider in the US, for $9.6 billion in an all-cash transaction. The deal is worth $20 billion in total, and is expected to close in about 18 months.

The acquisition means Frontier’s 2.2 million internet subscribers across 25 states will all become Verizon customers, adding to Verizon’s 7.4 million Fios connections.

The deal is worth about $38.50 per share for Frontier investors.

Shares of Frontier dropped 9.51% today, while Verizon shares dipped 0.43% after the announcement.

Verizon CEO Hans Vestberg called the acquisition a “strategic fit” in a statement, and added that the deal will enable Verizon “to become more competitive in more markets.” Translation: Watch your back, AT&T.

What’s the big deal, anyways? Fiber-optic internet is a kind of uber powerful internet connection that sends data far faster than cable internet. M&A for fiber internet companies has become more popular as broadband providers look to corner the few remaining neighborhoods that lack high-speed internet in their markets.

According to Verizon’s statement, Frontier has invested $4.1 billion upgrading its fiber network, and gets 50% of its revenue from its “fiber” products.

Ironically, Verizon will be buying back some of its own network infrastructure it previously sold to Frontier in 2016 for $10.5 billion. Now, that same internet framework in states like California, Texas, and Florida, is in key areas where Verizon wants to expand its footprint.

What does the deal mean for investors? While the acquisition will no doubt expand Verizon’s customer base and sharpen its competitive edge, it also sinks Verizon deeper into its $120 billion debt pile.

Shareholders will expect Verizon to tighten its belt after already spending big over the past few years. In 2021, the company splashed out $45 billion to buy 5G wireless services, which ended up costing billions of dollars more to actually use.

Verizon CFO Tony Skiadas said today that the firm increased its dividend for the 18th consecutive year, and reiterated that paying down debt is a top priority—even as the firm takes out even more to acquire Frontier. Verizon is betting it can produce enough cash in the coming years to pay off its monster tab without cutting dividends to shareholders—but that’s a high-stakes gamble to the tune of tens of billions.

Maybe that’s why analysts are almost evenly split between those who have a bullish rating on Verizon stock and those who recommend that investors “hold" for now.—LB

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🟢 What’s up

• Nio—the Chinese EV maker, not the Keanu Reeves character—soared 14.52% after reporting record deliveries last quarter and forecasting a stronger quarter ahead.
• US Steel continued its roller coaster ride today, rising 1.97% on the rumor that President Biden will block its acquisition by Japan’s Nippon Steel.
• JetBlue Airways ascended 7.16% after the company boosted its revenue guidance for the coming quarter.
• G-III Apparel Group rocketed 22% thanks to a shockingly impressive quarter for the fancy apparel maker.
• Shoe Carnival, which sells shoes and isn’t in fact a poorly scripted horror film, popped 8.20% thanks to a back-to-school shopping boom.

What’s down

• C3.ai, which sounds like the name of a new Star Wars droid, sank 8.21% after the enterprise software company announced that subscription revenue fell short of expectations last quarter.
• Hewlett Packard Enterprise staggered 6.02% after posting record AI revenue but paying the price for it.
• Copart dropped 6.67% once the online car auctioneer reported solid revenue growth but missed earnings expectations last quarter.
• ChargePoint plummeted 17.75% thanks to an absolutely terrible quarter for the EV charging network company.
• Toro Company, makers of your dad’s favorite lawnmower, fell 10.09%. Sales to residential customers rose last quarter, but sales to professionals, who buy more expensive equipment, fell.

You might think that after a series of bungled product rollouts this year, including Tesla delaying the launch of its new robotaxi just last month, shareholders wouldn’t blindly celebrate every tentative announcement the EV company makes via X.

But you’d be wrong.

Investors sent shares of TSLA soaring 4.90% today after the firm announced that its “Full Self Driving” (FSD) service, a highly anticipated AI add-on feature, is set to launch in Europe and China in the first quarter of 2025 (pending hard-to-secure regulatory approval, of course).

You might also assume that a product dubbed “Fully Self Driving” would mean, well, it’s a fully self-driving autonomous vehicle. Wrong again!

The feature, which Musk has touted as one of the company’s key products qualifying it for AI stock status, still requires drivers to be sitting in front of the steering wheel and paying attention 100% of the time. Which may seem ironic, given that Musk claimed all the way back in 2016 that Tesla’s EVs could “drive autonomously with greater safety than a person. Right now.”

But the product is still set to be a huge moneymaker for Tesla, and does show that the company’s AI offerings are improving. FSD, while not completely self-driving, is a clear step forward from current autopilot features.

Tesla’s rough year

This has been a tough year for Tesla, with shares down about 7% in 2024. But the stock is up nearly 10% over the last five trading sessions. So what exactly drove this recent surge higher?

One factor that appears to have caused Tesla to make the biggest gain in the S&P 500 yesterday was a post from Elon that stirred up enthusiasm among his fanatic fans investors.

In response to someone on X asking how his day was, Elon wrote, “Just leaving Tesla engineering offices in Palo Alto… the future is going to be wild. There will be so many robots.”

In lieu of car delivery data that Tesla won’t report until October, investors are relying on Musk’s signature blind optimism to carry them through the carmaker’s current rut. And let’s be real—even without solid data, Tesla diehards will stay loyal to Elon either way.—LB

Diggin’ for data. Market data is basically as precious as gold, so the information gap between Wall Street and, well, non-Wall Street is the bane of every investor’s existence. Stocks.News delivers a full ecosystem of stock analysis, analyst forecasts, and insider trades on a silver platter along with a bunch of free analysis metrics. Get it.

• Here’s how much each NFL team is worth. The most valuable: the Dallas Cowboys. The least valuable: the Cincinnati Bengals. The hardest to watch: still the New York Jets.
• The stock market slump could continue to escalate, according to a Goldman Sachs technical analyst.
• Banks are raking in the money, reporting record profits last quarter thanks to higher non-interest income and lower expenses.
• American workers are more productive than economists originally thought.
• How much money do you need to consider yourself rich? The number keeps rising.
• Five stocks that outperform by delighting their customers.

Tomorrow’s the big day. The US jobs report compiles labor market data from a variety of sources, and provides perhaps the most comprehensive look at the state of jobs here in the US.

Remember, this is the very same report that sank the stock market in early August, when the July report revealed that the US only added 114,000 jobs in the previous month. That was dramatically lower than expected, and spurred fears that the Fed would be unable to stop an economic downturn.

For the August report tomorrow, economists expect employers to have added 161,000 jobs in the previous month, and the unemployment rate should fall about tenth of a percentage point to 4.2% from July. Any worse than that and investors may be facing another selloff, though the good news is that bad data would likely encourage the Federal Reserve to make steeper interest rate cuts in September.

Before the open

• Genesco (GCO) makes all your favorite shoes, like Vans and Converse. Unfortunately, it’s probably not your favorite stock. Shares are nearly flat year-to-date, with the company closing stores to conserve capital as revenue flattens. But seasonality plays a big part in the shoe business, and the back-to-school season could give this stock the juice it needs to surprise investors to the upside. Consensus: -$1.11 EPS, $512.30 million in EPS.
• Big Lots (BIG) has had an absolutely terrible year, with shares sinking over 90% in 2024. The problem isn’t just lower consumer spending, it’s liquidity: Big Lots is on the verge of bankruptcy, and is likely unable to meet its debt obligations anytime soon given its lack of profitability. While you’d think a discount retailer would perform well in the current economic climate, this is one stock that’s unlikely to turn things around anytime soon. Consensus: -$3.46 EPS, $1.04 billion in EPS.

Trying to quit your job? Hire a pro.

Japanese work culture can be pretty intense, with employees in the country usually expected to work for one employer their entire life. Quitting a job is often seen as a form of extreme disrespect, and some bosses even rip up employee’s resignation letters, harassing them into staying.

That’s why resignation agencies, which guide employees through quitting their jobs, have been gaining popularity. These firms negotiate resignations and provide legal protection to employees who receive flak on their way out the door.

While we applaud anyone who exercises their right to quit their job, we’re content to enjoy a bit of catharsis by watching the 10 best quitting scenes from movies instead.—MR