Verizon Communications Stock Is Soaring in 2026. Here's Why It Can Still Go Higher

Shares of Verizon Communications (NYSE: VZ) are up an impressive 24% this year, dwarfing the S&P 500, which is down around 4% thus far. It's been one heck of a comeback story for Verizon's stock, which has struggled to win over investors in recent years.

But despite its strong rally to start 2026, it may still have room to rise even higher. Here's why it may not be too late to invest in the dividend stock right now.

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The business has been looking much stronger of late

In the past, there were growing concerns about whether Verizon could keep up with its rivals. But in the company's most recent earnings report, it appeared to put those fears to rest. In January, Verizon released strong numbers with the headline being that it generated the highest number of quarterly net adds since 2019.

It finished 2025 with a modest 2.5% increase in revenue, with its top line climbing to $138.2 billion. Its operating income of $29.3 billion also rose by a modest 2%. While those weren't necessarily blowout numbers for the business, they did energize investors and give them confidence that the business is moving in the right direction under new CEO Dan Schulman, who said, "Verizon will no longer be a hunting ground ‍for our competitors." The company also unveiled a strong forecast for profit and cash flow for the year ahead that beat analysts' expectations.

Why Verizon's stock looks destined for more gains

Although Verizon's stock may look like it's gotten too hot, there may still be much more room for it to rise higher. Even with its impressive gains in the early part of the year, it's still down 11% over a five-year stretch. The stock has routinely underperformed the market, and the last time it generated double-digit returns was in 2016 when it rose by 15%.

It currently trades at 12 times its trailing earnings, and based on analyst projections, its forward price-to-earnings (P/E) multiple is just 10. By comparison, rival AT&T trades at a forward P/E of just over 12. Investors have also been gravitating toward dividend stocks this year amid economic uncertainty and geopolitical issues weighing on markets, potentially driving a higher premium for these investments in the near future.

Not only is Verizon looking cheap, but it's also showing progress in its growth strategy and offers a fairly high dividend yield of 5.7%. That makes it a fairly compelling investment option to consider right now, which is why I wouldn't be surprised if Verizon's stock were to continue rising higher in the weeks and months ahead.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.