With the advent of the 5G Revolution right around the corner, now is the time tech-savvy investors should consider adding 5G exposure to their basket of stocks before they get left behind the looming “high speed’ bull market rally. 5G technology promises to be up to 100-times faster than the current benchmark 4G data networks. With this revolutionary leap in capability, cutting edge industries such as Artificial Intelligence, Autonomous Driving Vehicles, Virtual/Augmented Reality and the Internet of Things are projected to flourish, presenting a tremendous opportunity for shareholders.
Due to the insatiable appetite for bandwidth consumption caused by data intensive mobile applications like 4k streaming video, cloud and virtual data room services, as well as video and photo sharing social media platforms, the demand for 5G technology is only growing. Mobile data usage has skyrocketed the past several years, roughly doubling on a yearly basis, and is forecasted to increase ten-fold by 2022. Analysts at the global financial firm KPMG estimate that the overall economic impact of the 5G rollout to be around $4.2 trillion dollars. Forward-thinking investors would be wise to consider adding these three stocks to their portfolios to unlock the massive earnings potential of the highly lucrative 5G movement before they get priced out of the market.
1.) AT&T Ticker Symbol :T
AT&T, the world’s biggest telecommunications company and number one provider of mobile phone and data services is a natural pure-play on the transition to 5G technology. So far to date, AT&T has jumped out to a slight lead offering 5G service in 12 US cities, while its next closest rival, Verizon, has initiated the state of the art data service in 9 US cities, respectively. With a lineage going back to 1885 and Alexander Graham Bell himself, AT&T has been front and center thriving off every communications technology revolution since the invention of the telephone; the 5G movement will be no different.
Aside from being the world’s top network provider, ticker symbol T, is set to unveil its own video and TV streaming service to take on the likes of Netflix and Disney. The HBO Max service will feature premium HBO content such as the wildly popular Game of Thrones series, as well as blockbuster Time Warner franchises like Friends, Harry Potter and the DC Universe. AT&T also pays out a dividend in the 7% annual range, which has risen steadily over the past 35 years, icing on the cake.
2.) American Tower Corporation – Ticker Symbol: AMT
An unprecedented amount of new cell towers, antennas and other essential infrastructure are crucial to facilitating the transition from 4G, to 5G data networks. Cell tower companies, like the American Tower Corporation, are well positioned to capitalize on the skyrocketing demand for more mobile antennae hardware. With a market cap of nearly $100 billion dollars, AMT is the largest among its peers of cell tower real estate investment trusts, owning and operating more than 170,000 sites in 16 countries.
American Tower’s stock has been trading up over 50% year-to-date, in comparison to the S&P 500, which has risen slightly over 19% in that same period. AMT’s latest quarterly revenue beat of just under $1.9 billion dollars combined with a healthy EPS of $3.31 is more evidence to support the bullish thesis of strong sustained growth, due to the exponential increase in global demand for data and cell towers. Since major network providers like Verizon and AT&T rent rather than own their cell antennae and tower apparatuses, AMT is able to provide a stable recurring revenue stream model to cultivate long term profitability as well as sustain its nearly 1.7% annual dividend.
3.) Apple – Ticker Symbol: AAPL
Currently ranked as the second largest company in the world with a nearly one trillion-dollar market cap, Apple, maker of the iconic iPhone, is poised to breakout with the implementation of fifth generation data networks. While smartphones sales industry-wide have been sluggish the last several years due to rising costs, lack of innovation and devices simply lasting longer, analysts predict a major phone upgrade refresh cycle in the near future with the release of all-new 5G integrated mobile devices. Benchmark products like the iPhone, iPad and MacBook are expected add 5G capability for the 2020 model year and are anticipated to see a boom in sales.
Don’t count out the growing profitability of AAPL’s wearables sector either, with products like the Apple Watch and Airpod continuing to gain market relevance. AAPL’s line of services such as Apple Music, Apple Pay and iCloud brought in just shy of $11.5 billion dollars last quarter alone, a jump of 16% year-over-year. With the imminent launch of its all-new “Netflix-killer”, Apple TV Plus subscription streaming video and TV service, expect the AAPL service division’s profits to further surge with the rollout of 5G technology.