Shares of Verizon (NYSE:VZ) failed to keep pace with the Dow Jones Industrial Average (DJINDICES:^DJI) in 2013, gaining only 12%, while the Dow doubled that return. Moreover, Verizon's stock trades at a nosebleed-inducing 64 times trailing earnings.

How did this happen?

In the video below, Fool analyst Anders Bylund explains how Verizon and fellow Dow telecom AT&T (NYSE:T) are fighting back a surge of revitalized rivals. He'll also tell you why the sky-high P/E ratio shouldn't scare Verizon investors. Spoiler alert: Think "amortization and depreciation."

Fool contributor Anders Bylund has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days.

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