Did Verizon’s Dividends Make Up For Its Weak Stock Price?
Investors who hold Verizon Communications (VZ) typically do so for the dividend paid by its wireless and broadband business. Over the past year, that payout contributed about 7 percentage points to the stock’s return. Even so, the share price has lagged behind the S&P 500 over a period of five years. So take a guess: with every dividend counted, what did a five-year holder make, and how close did it come to the market?
How Far Has Verizon Stock Trailed The Market?
Measured by share price alone, Verizon stock fell 20.1% over the past five years. During that same window, the S&P 500 rose 79.6%. That left Verizon 99.8 percentage points behind the broader market. An investor focused strictly on the share price absorbed a loss, while those holding the market index saw substantial gains.
How Much Did Verizon’s Dividends Add?
Once dividends are reinvested, Verizon stock returned 11.2% over five years. This marks a result 31.4 percentage points higher than the return on price alone. A five-year holder ultimately made money, but only because the dividends offset a falling share price.
Did The Dividends Close The Gap For Verizon Holders?
They did not. Companies in the S&P 500 pay dividends as well, and a fair comparison requires counting those payouts for both Verizon and the broader market.
| Return over five years | On price alone | With dividends reinvested |
|---|---|---|
| The stock | -20.1% | +11.2% |
| S&P 500 | +79.6% | +91.6% |
Before taxes and costs. The S&P 500 is measured through the SPDR S&P 500 ETF.
Verizon’s payouts certainly added more than the market’s. The index’s dividends added 12.0 percentage points over the same five years. However, the S&P 500 returned 91.6% with dividends included, leaving Verizon trailing by 80.4 percentage points. Ultimately, the dividends closed only part of the stock’s shortfall against the market.
What This Means If You Own Verizon For Income
Verizon investors secured more cash than the market offered, but they traded capital growth for immediate income. Over the past year, the dividends of the S&P 500 added just 1.0 percentage point to its return, compared with about 7 points for Verizon. Over five years, however, Verizon holders recovered only a small part of their shortfall against the broader market.
That dividend cash comes from Verizon’s wireless and broadband customers. The company relies most heavily on its Consumer segment, a division that generated 77% of revenue in fiscal 2025. During the fiscal Q2 2026 earnings call, executives noted that second-quarter free cash flow increased 24% from a year earlier. They described the period as one of the strongest cash flow quarters in the company’s history. For an income holder, the essential metric to watch is Verizon’s return with dividends against the S&P 500’s return with dividends, never the dividend on its own.
Does This Mean You Should Act On VZ?
Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.
There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.