Best 5G Stocks
The next major upgrade in the telecommunication industry is going to be the rollout of 5G technology. As we get close to the commercialization of the technology, it becomes interesting to look at the firms leading the innovation. This is important because innovation is one of the major drivers of stock prices. The commercialization of 5G might lead to a big surge in the stock prices of 5G stocks.
5G elevates our communication to an entirely new dimension. 5G also augurs well for tech firms, as they can launch new AI applications to solve real-life problems.
5G network provides $3 trillion in wireless revenue opportunities. Over the next decade, tech and media firms will compete to capture them.
Let’s have a look at the top 5G stocks.
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Best 5G Stocks to Buy
- Intel Corporation (NASDAQ: INTC), Market cap: $188B
- CEVA (NASDAQ: CEVA), Market Cap: 929M
- Verizon Communications Inc. (NYSE: VZ), Market Cap: $235B
- Inseego Corp. (NASDAQ: INSG), Market Cap: 889M
- Nokia Corporation (NYSE: NOK), Market Cap: 19B
- Ericsson (NASDAQ: ERIC),Market Cap: 28B
- Qualcomm (QCOM),Market Cap: 143B
- T-Mobile US (TMUS),Market Cap: 138B
- Analog Devices (ADI),Market Cap: 44B
- American Tower (AMT),Market Cap: 103B
- Apple Inc. (NASDAQ: AAPL),Market Cap: 2.0T
- Alphabet Inc. (NASDAQ: GOOG),Market Cap: 1.1T
- Broadcom (AVGO),Market Cap: 144B
Intel Corporation is a leader in technology. They are actively pursuing 5G technology. In August 2020, MediaTek announced advances in its collaboration with Intel. The two firms plan to bring 5G for next-generation PCs with the successful development of a 5G modem. It is expected that the laptops enabled with 5G modem are set to release in 2021.
Ceva Inc. is another top stock looking to gain from 5G innovation. This company specializes in wireless connectivity and digital signal processing technology. CEVA is considered among the top 100 Israeli companies.
In 2019, Ceva licensed its technology CEVA-Dragonfly NB2 to an Indian company WiSig Networks. The 5G technology will enable a range of services such as asset tracking, industrial automation, and remote monitoring.
In September 2020, Picocom licensed CEVA-XC12 DSP. The company will use it in its forthcoming baseband offload System-on-Chip (SoC) for 5G small cells. CEVA-XC12 software-defined radio (SDR) DSP provides the high performance required for 5G processing. The product also has a low power consumption, promoting its usage for small cell power-constrained use cases.
Verizon Communications Inc.
Verizon Communications Inc. is a very distinguished company and has set itself apart in developing 5G technology.
Last week, the company announced that it now opened up its nationwide 5G network. It was only offering mmWave coverage for months. The latest iPhones and some Android phones are also getting support for Verizon nationwide 5G.
Inseego Corp. is a United States technology company specializing in communications equipment. The company is involved in the design and development of mobile, Internet of Things (IoT), and cloud solutions. The firm is known for its 4G and 5G fixed wireless routers and gateways.
Nokia is the world’s one of the largest infrastructure equipment supplier to the wireless industry. Nokia stocks did not perform well over the last couple of years as they were slow to adapt to the smartphone revolution. However, their focus on 5G technology should beef up their margins. Analysts believe that streamlining the processes should also help Nokia.
Nokia is heavily dependent on its investment in 5G technology. On October 29, Nokia CEO Pekka Lundmark reaffirmed the firms resolve to “do whatever it takes” to take the lead in5G. The company currently lags behind Swedish rivalEricssonand Chinese groupHuawei.
Ericsson is a Swedish telecom manufacturer and is currently winning the 5G race.Ericsonis the first company to launch live commercial5Gnetworks on four continents. The company has already finished 100 commercial contracts for 5G installations.
Qualcomm develops intellectual property, semiconductors, software, and services related to wireless technology. The company makes money from licensing its technology and patents to other companies. The company is also famous for its state-of-the-art Snapdragon family of chips.
Apple realized in 2019 that Intel’s 5G modems would not be ready for iPhone in time. Hence, Apple signed a $4.7 billion worth of contract with Qualcomm. This is in addition to any future royalties that Apple will pay for using Qualcomm chips in its devices. The deal buys Apple a global patent licensing agreement for six years with Qualcomm, with an option for prolongation for two more years after that.
In April 2020, T-Mobile acquired Sprint. The merger of USA’s third and fourth-largest wireless companies puts their collective subscribers on an even footing with Verizon and AT&T (T).
To receive approval for the merger, T-Mobile promised to deliver a 5G network to 99 percent of American homes within six years. The company will also ensure that 90 percent of the population receives 100 megabits per second (Mbps).
Analog Devices is known for creating analog-to-digital converter chips. The chips convert analog electrical signals to digital signals.
This company might not be a household name such as T-Mobile. However, they are an essential player in 5G technology with a meaningful market share. A typical 5G base station requires eight times as many channels as a 4G base station for wireless phone transmission. This creates a significant opportunity 5G opportunity for Analog Devices.
American Toweris a large-capreal estate investment trust (REIT)and is a major player in the telecommunications market. The company owns approximately 181,000 cell towers worldwide, including 41,000 in the United States. The company makes money by leasing space on its cell towers to its customers for attaching communications devices.
5G has led to significant growth for the company.
Apple Inc. is one of the biggest technology manufacturers in the world. Apple designs, manufacture and sells a variety of technology products. Recently it became the first company with a two trillion market cap.
Currently, the company is considering a four to one stock split. The lower share prices should attract small investors, and hence the stock prices should go up. The company recently launched iPhone 12, which has 5G connectivity.
Alphabet Inc. is the us-based holding company of Google. Earlier this year, Alphabet Inc. announced its partnership with AT&T to deliver 5G services for corporate clients. First, they plan to go after retail, manufacturing, and transportation markets.
The two companies are currently testing products that AT&T will offer its 5G customers through Google Cloud. Google also recently launched 5G enabled phones this fall.
Broadcom is a semiconductor company that produces chips for wireless communication. The company also sells chips for enterprise storage and industrial end markets. The company is also one of the major chip suppliers for 5G base stations.
The launch of 5G iPhones has propelled Apple shares and the shares of component makers associated with Apple.
Hock Tan, CEO of Broadcom, announced recently that the last quarter should show a “strong anticipated ramp in wireless, as well as the continuing surge in demand for networking from cloud and telecom customers.”
Broadcom did not expect that Apple focuses on the 5G network for all its new iPhones. The news came a bit as a surprise and a boon to the company. Last month Hock Tan said the company didn’t expect that the shift to 5G would go that fast.
The next-generation 5G network is supposed to make wireless communication even faster. As a result, a growth of 40% in the amount of semiconductors wireless devices is realistic. Wireless makes up about 14% of Broadcom’s revenues. Hence, the company will emerge as a big winner due to the technological shift.
Analysts believe that Broadcom will have 40 percent content growth in 5G iPhones compared with 4G models. Broadcom has a free cash flow margin of greater than 40 percent. This provides plenty of room to support its 4.1 percent dividend payouts and a target of 10.6 percent earnings per share growth.
The 5G infrastructure market is currently estimated to reach 50 billion by 2027 at a compounding growth rate of about 68 percent since 2020. The main driving factors are the lower latency of 5G networks and growth in mobile data traffic. There is also growing adoption of virtual networking architecture in telecommunications. Increasing M2M connections is also expected to push the growth of 5G infrastructure. The industry is expected to support 22.3 million jobs by 2035.
As of January 2020, 378 countries in 34 countries have 5G connections with varying levels of deployment. Ericsson, a Swedish telecom company, projects that 5G connections will cover 65 percent of the world’s population by 2025.
5G technology has already been enabled in smartphones etc. are being sold in 24 countries.
GSM Association (GSMA) projects that 5G will support 20 percent of total global connections by 2025. GSMA also predicts that the number of global IoT connections will more than double to almost 25 billion by 2025.
The data compiled by Finbold.com estimates that by 2025, the number of 5G connections will be 2.7 billion worldwide. This reflects an expected growth of at least twenty times from this year’s figure of 120 million.
The best 5G stocks offer excellent growth potential and high returns. Dividends, market share, and profitability should be considered before finally investing in this segment. Some 5G stocks like Apple belong to the belongs to the most volatile stocks.
5G brings both controversies and opportunities for investors. It makes internet connection fast and pushes wireless networks to the next speed level. Artificial intelligence is already part of the technology. I n the next upgrade cycle, A.I. will play ay an even more significant role. Internet connectivity is more important than ever before, and companies who understand this will be the next growth stocks.