5G Wireless Network Stocks with Upside

Saturday, June 20, 2020 | Sean Sechler
5G Wireless Network Stocks with Upside

This year, we have seen more people than ever before using wireless networks to stay connected. Whether they are working from home, taking online classes, or simply staying entertained during stay-at-home orders, the need for high-speed networks has never been greater. This has lead to an accelerated rollout of the 5G network and has many companies ready to capitalize.

5G, or 5th Generation mobile network, is the newest update to global wireless connectivity. At this point, the existing 4G network has reached its peak in terms of speed and efficiency. The new 5G mobile network will provide faster connectivity, lower latency, and more efficient performance for digital devices worldwide. The economic implications of 5G technology are massive, as many businesses will have to update their infrastructure and products in order to switch over to the new network.

Naturally, there are several companies that are well-situated to benefit from the global shift to 5G. Here are some great 5G wireless network stocks with upside to consider buying.

Qualcomm (NASDAQ:QCOM)

There are a number of good reasons to look into Qualcomm stock, including its partnership with Apple (NASDAQ:APPL), its nice dividend yield, and its strong balance sheet. The company reported $8.4 billion in cash and cash equivalents on its books at the end of Q2 and has rewarded investors with a very solid dividend growth rate over the years. However, the most exciting thing about this stock is how key of a role it will play in the 5G revolution.

Qualcomm is a semiconductor company whose chips are used in smartphones and other networking equipment. The company is focused on finding a way for their 5G technology chips to make their way into more affordable devices and recently debuted a new chip called the Snapdragon 690. This chip should allow for companies to produce more affordable 5G smartphones and devices thanks to its lower price point. Qualcomm’s chips are already found in tons of smartphones and digital devices that operate on the 4G network, and the demand for their chips will only increase with the shift to 5G.

American Tower Corp (NYSE:AMT)

When you think about stocks that will be critical components to the success of 5G’s rollout, why not take a look at a company that owns the towers that send the wireless signals out? American Tower Corp is one of the largest tower companies in the world with over 180,000 communication sites worldwide. Each one of those towers will be very important as 5G becomes the new standard for global telecommunications. 

One of the reasons why this stock is a good buy has to do with its major tenants such as AT&T, T-Mobile, and Verizon. The company leases its towers to tenants with an initial non-cancelable term of 5 to 10 years, which means it has steady and reliable revenue streams. Another big plus with American Tower Corp is that it is structured as a REIT or Real Estate Investment Trust. That means the company is required to pay out at least 90% of its annual taxable income to qualify for special tax incentives. The company grew its common dividend in Q1 by 20%, which is certainly attractive. You can anticipate nice dividend income along with steady organic growth potential by buying AMT.

T-Mobile (NASDAQ:TMUS)

In a market where any headline can send stocks directly into volatility, a discount telecommunications company is absolutely worth a look. Since T-Mobile offers affordable phone services at cheaper prices than its competitors, the company will be able to hold their own regardless of current economic conditions.

T-Mobile recently announced a historic milestone by offering 5G services across all 50 states and seems to be moving quickly with providing its customers with access to the new network. Although it might not have the fastest 5G capabilities, the fact that this company is first in rolling out its 5G network is a testament to their ability to execute. Also, T-Mobile recently acquired Sprint, which means they have also added Sprint’s large mobile network. To quote T-Mobile’s recent earnings report, “synergies have the potential to unlock massive scale and unleash an expected $43 billion in value for shareholders”. This is a great defensive stock with leadership that is clearly focused on creating the best 5G network possible for its customers.

Strong Signals

Each of these companies provides a different business model that can put investors in a position to profit off of the rollout of this exciting new network. Keep in mind that 5G technology will forever change the way that the world stays connected, which is why adding these stocks makes so much sense.

 

 

 

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7 Stocks That Can Help You Profit From Summer Shortages

One of the lingering impacts of the Covid-19 pandemic is the supply chain disruptions that continue to bedevil many sectors. By now, every investor is aware of the global chip shortage that is disrupting many sectors that were projected to have strong growth in 2021.

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
QUALCOMM (QCOM)2.9$135.58-1.3%2.01%19.45Buy$166.60
American Tower (AMT)2.4$270.47-0.2%1.83%62.75Buy$281.18
T-Mobile US (TMUS)1.6$145.68+0.3%N/A59.95Buy$155.27
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