If you are following the adoption of 5G also known as fifth-generation wireless technology, you could be wondering if now is a good time to start investing and what the best 5G stocks to buy are. This post highlights 12 5G stocks that I believe should be on your watch list, they are:
- Qualcomm Stock (NASDAQ: QCOM)
- NVIDIA Stock (NASDAQ: NVDA)
- Ericsson Stock (NASDAQ: ERIC)
- Ciena Stock (NYSE: CIEN)
- Nokia Stock (HEL: NOKIA)
- T Mobile Stock US (NASDAQ: TMUS)
- Apple Stock (NASDAQ: AAPL)
- Broadcom (NASDAQ: AVGO)
- Analog Devices Stock (NASDAQ: ADI)
- Verizon Communications (NYSE: VZ)
- Skyworks Solutions (NASDAQ: SWKS)
- Inseego Stock (NASDAQ: INSG)
5G deployment is proving to be one of the most significant technological innovations over the last few years. Many of the stocks of these firms are outperforming other tech stocks on the NASDAQ and New York Stock Exchange (NYSE) and it’s a trend that’s likely to continue in 2022.
However, while the pandemic and recession put a cap on the progress seen by some 5G stocks, others have continued their trends up with barely a shrug. Some companies have suffered because the pandemic has delayed the implementation of this next-generation technology which has been compounded by reduced consumer products in some areas.
Table of Contents
What you need to know
5G is the latest generation of wireless networks, superseding 4G and everything that came before it. The technology will bring faster connection, fewer lags, and new technological possibilities, like software using the internet of things.
When you think of fifth-generation wireless technology, the first Wall-Street companies that spring to mind are probably mobile phone manufacturers — like Apple — or network providers, such as Verizon Communications.
These companies indeed stand to gain enormously from the adoption of 5G as consumers upgrade cycle see consumers their phones and contracts. However, success isn’t a guarantee. Consumer interest may rely on the invention of a “killer app” — perhaps related to augmented reality gaming.
Some analysts argue consumer interest relies on the invention of a major app — perhaps related to augmented reality gaming.
Yet it’s not just consumer-centric firms that will benefit.
5G will also be increasingly relevant for enterprise solutions. It could revolutionize sectors like healthcare, which badly need greater connectivity.
Then there are the parts manufacturers. Semiconductor companies and chipmakers like blue-chip Qualcomm and NVIDIA could be big winners from the adoption of 5G.
This list contains a mixture of enterprise- and consumer-oriented firms involved in the phones, parts, and networks involved in the deployment of 5G. Keep in mind these stocks are growth stocks, which means that if they pay dividends, the dividend income isn’t going to be great plus the stocks tend to be a higher risk so always do your own research!
The Types of 5G Stocks
Before we get started a quick word on the type of 5G stocks and the companies behind them.
Broadly, fifth-generation stocks can be separated by the type of business they are involved in. So there are semiconductor manufacturers (more commonly known chipmakers), there are also manufacturers of equipment and infrastructure.
These include 5G small cells and the antennas that carry the network signal and there are also companies that own real estate assets. Worth mentioning is there are a number of ETFs that operate in the market that invests in the 5G arena. 5G has got many interesting companies, but like other sectors, not all companies have publicly available stocks eg. SpaceX or Hulu so if you want to look beyond the 12 I’ve listed here, be warned.
12 Best 5G Stocks to Buy
1. Qualcomm Stock (NASDAQ: QCOM)
Qualcomm is a semiconductor company set to benefit from 5G because it produces smartphone parts, including chips for Apple.
It also owns Qualcomm Technology Licensing, allowing it to collect royalties from wireless devices and infrastructure.
The chipmaker also plans to establish 5G developmental platforms, such as AI and robotics products that use 5G.
Qualcomm’s stock surged in November after it reported strong earnings. Going forward, analysts have a buy rating for the stock with $450 and $200 are the high and median expectations for the stock price. The dividend yield is 1.6%.
Additionally, Qualcomm has put behind it the dispute the firm had with Huawei receiving $1.8 billion in settlement legal settlement.
As the chart below shows, the value of Qualcomm stock value has sharply increased recently, and it’s likely to keep rising.
The company continues to make money from selling more 5G chips, and much of the $9.3 billion reported revenue, much of this is down to smartphones sales. If you believe 5G will be a profitable business, the success of Qualcomm is almost inevitable.
2. NVIDIA Stock (NASDAQ: NVDA)
Nvidia creates chips and graphic cards, both of which will be essential for powering 5G networks and keeping them running fast.
Its smart graphic processing units help stop bandwidth wastage in virtual radio access networks, allowing the transfer of bandwidth from one machine to another. It’s a market expected to grow at around 128% per year by 2024.
Nvidia is also one of the biggest data center processor providers for cloud computing. Cloud applications will use 5G to promote “edge computing,” which uses data at the “edge” of a network in real-time with no lag. The firm is already benefiting financially from this innovation.
Basically, Nvidia is bound to play a huge role in ushering in many futuristic technologies — not just edge computing but also self-driving cars and robotics.
Apart from the dip when Coronavirus first hit, Nvidia has been on an almost linear growth path, and its stock price increased exponentially after recovering from the crash.
It exceeded the expectations of analysts last quarter in terms of both top-line profits and adjusted earnings.
In 2021, NVIDIA stock more than doubled in price and there’s still potential for more. This could well be an exciting growth stock in the years to come, and a fantastic option for any futurists.
3. Ericsson Stock (NASDAQ: ERIC)
Nvidia and Ericsson have partnered to bring greater efficiency through building efficient radio access networks for 5G. If you’re convinced Nvidia will be successful, chances are you’re also willing to bet on this stock.
Ericsson is a big player in the 5G world in its own right. The company sells telecommunications equipment, services, and software.
It currently has a 27% market share in 2G, 3G, and 4G mobile networks, and now it’s hoping to delve into the world of 5G, too.
The company has already signed more than 100 deals to help customers upgrade their services to 5G.
As you can see from the above, Ericsson has had an impressive recovery since it bottomed. We’re talking about a multi-billion dollar company with good fundamentals and some promising developments to come — what’s not to like?
4. Ciena Stock (NYSE: CIEN)
Ciena is another telecommunications equipment provider. It helps companies set up their optical fiber networks; essential equipment for 5G since they provide unlimited bandwidth. Ciena’s clients include big-name companies like Vodafone and Verizon (which features lower down on this list).
Ciena is another telecommunications equipment provider. It helps companies set up their optical fiber networks; essential equipment for 5G since they provide unlimited bandwidth.
Ciena’s clients include big-name companies like Vodafone and Verizon (which features lower down on this list).
It also provides related solutions like routers, network software, and transport networks optimized for 5G.
Currently, Ciena has nearly a quarter of the optical network hardware market, a segment set to grow 6% until 2024.
Although there was an initial crash around March, Ciena has mostly benefited from the pandemic thanks to the increased need for those working at home to remain connected.
Ciena’s stock price has been increasing at an alarming rate recently, and there’s no reason to think this upward trend won’t continue thanks to the number of huge companies working with Ciena to get ready for 5G. Analysts believe the stock price remains undervalued and is in a great position to grow over the next few years.
5. Nokia Stock (HEL: NOKIA)
Although Nokia might not be the popular phone manufacturer it once was, it remains a major supplier of infrastructure equipment to wireless companies. The company is worth around $24 billion — not exactly small fry.
It might not be the obvious choice for a 5G stock, but don’t discount Nokia.
It currently has 67 5G contracts and has won almost every bid it’s made so far. Nokia also has less reliance on China than some of the other companies on this list, which could turn out to be a blessing if more countries impose restrictions.
Although Nokia’s stock price fell after the market drop, it’s since recovered to higher than its pre-Covid level. In fact, over the last six months, it’s risen by around 15%. Bank of America has a target price of $4.80 for the stock. The majority of 5G stocks covered here are US based, Nokia is an exception and while ADRs of the stock are traded on the NYSE under NOK, I’m showing the Finnish stock price (NOKIA).
6. T Mobile Stock US (NASDAQ: TMUS)
T-Mobile is the third biggest mobile network in the US — of course, it plans to take advantage of 5G.
The network is currently ahead of competitors AT&T and Verizon Communications in terms of 5G deployment in the US, already covering over 200 million people.
Some analysts think it could be the first wireless carrier with a full 5G network throughout the US.
That’s not the only piece of good news. T-Mobile signed a merger deal with Sprint this year, making it a strong competitor against bigger networks.
It also plans to use mid-band frequencies, which analysts say is a key factor for stock value.
T-Mobile may be the underdog, but its stock performance during 2021 has been impressive, and Deutsche Bank has a $195 target. All in all, it looks like a very promising investment.
7. Apple Stock (NASDAQ: AAPL)
As the major smartphone producer has launched its 5G iPhones (iPhone 12 and 13), Apple is set to be a significant beneficiary of the 5G boom.
It’s a popular choice for investment thanks to its strong record, but remember that the best time to invest is when a stock is undervalued, and the price of Apple’s stock is currently soaring.
Analysts have predicted the new 5G model could still spark an upgrade cycle. However, its success will partly depend on how expensive the phones are and whether consumers can still afford to buy as part of the upgrade cycle during a recession.
After an initial dip, Apple’s stock price is now well beyond its initial point before the crash. However, many analysts think there’s still room to grow.
8. Broadcom (NASDAQ: AVGO)
Broadcom is a semiconductor firm that makes chips for industry, enterprise storage, and wireless communication — including chips for 5G base stations. It’s different from the competition because its chips use film bulk acoustic resonator technology, which will become more relevant as the world catches on to 5G and in turn, 5G stocks.
It’s different from the competition because its chips use film bulk acoustic resonator technology, which will become more relevant as the world catches on to 5G.
Like most companies, Broadcom took a sharp hit after Covid, but it has since made a full recovery. It seems in a great position for the future, with impressive cash flow; Bank of America has given the stock a target price of $750.
Broadcom may not experience serious gains from 5G for another year or whenever new 5G smartphones become more mainstream. However, it should benefit from an Apple launch in late 2022.
Of course, it’s good news for investors that growth is still to come — so you might consider getting on board while the stock price remains undervalued.
9. Analog Devices Stock (NASDAQ: ADI)
Analog Devices is another semiconductor company that will play a large role in 5G implementation. But it’s more than just that — the company is vital for 5G radio signal chain technology, owning around a 70% market share in the field.
The stock price took a massive hit during the Coronavirus crash, and US-China relations and problems with Huawei didn’t help. However, since then, it’s one of the 5G stocks that has steadily recovered, with a few peaks and dips along the way.
Revenue from communications is increasing and 5G should only accelerate this trend. If you’re prepared to take the risk, investing when prices fall could be a smart move. Bank of America set a $220 price target for the stock over the next few years.
10. Verizon Communications (NYSE: VZ)
Along with T-Mobile, Verizon Communications is one of the primary US network providers. Its stock price has been shaky over the last few months with no clear trend, so this isn’t an investment for the faint-hearted. However, this could be a great opportunity to buy into an established company likely to gain from 5G.
Verizon exceeded its initial plan to increase its 5G sites by 500% during 2021, ready for the deployment of its network. It now hopes to gain from more homes demanding 5G wireless broadband services.
Compared to the other 5G stocks covered here, the stock price’s recent performance has been inconsistent and is yet to fully recover to its pre-Covid peak. However, thanks to its loyal customer base and strong balance sheet, it’s likely to succeed in the long term. Analysts have a top-end $71 price target.
11. Skyworks Solutions (NASDAQ: SWKS)
Skyworks Solutions may be a minor chipmaker compared to some of the other 5G stocks on this list, but that’s what makes it so exciting.
Despite a more modest size, Skyworks Solutions sure has some notable contracts. One of its biggest clients is none other than Apple, so it stands to benefit from any success the company has, including the release of a new 5G iPhone.
Its most recent quarterly report may seem unimpressive on the surface (revenue down almost 4% compared to the year before), but it still surpassed the predictions of analysts. Research firm Argus raised the price target recently from $112 to $146, proving the optimism some pundits now feel toward the stock.
The firm suffered after having to curtail its relationship with Huawei after restrictions imposed. But, after an initial financial hit, it now seems set for a successful end to 2020. The stock price is on a steady upward trend, and this only seems likely to increase further.
12. Inseego Stock (NASDAQ: INSG)
Last but not least on our list of 5G stocks is the telecom infrastructure company, Inseego. The firm is one of the 5G stocks that is a play on 5G infrastructure – it produces Fixed Wireless Access routers and mobile hotspot devices. In other words, the equipment is complementary to 5G deployment, meaning Inseego could gain hugely.
The company has seen its stock price grow in anticipation of the emergence of 5G — and seeing its revenue growing by 17%.
After the market crash, its stock price saw a stark recovery, followed by peaks and dips but since the start of 2021, the price has suffered, perhaps the most of the 5G stocks covered here. That said, as a premier manufacturer of parts that are essential for 5G, Inseego is still a company to watch over the next few years.
Consumers and businesses alike will be more likely to want its routers, cables, and hotspot devices after the introduction of 5G. Buying in while this is still a small-cap business could prove to be a smart move.
5G Frequently Asked Questions
Is 5G a good investment?
5G could be a technological innovation that proves to be a game-changer for both consumers and enterprises over the next few years. Of course, no investment is risk-free, so make sure you do your research before investing your money. It’s best to understand the underlying technology and not just the hype.
When will 5G take off?
There have been many tensions regarding 5G recently after US-China relations became problematic and the pandemic slowed down 5G implementation. However, in late 2020, the rollout of 2020 should happen, which will trigger smartphone and other technological upgrades. At this point, analysts expect the stocks to take off. However, to earn the most from price increases, it’s best to invest before this happens.
Stocks are under $10
One of the cheapest stocks available is Nokia, which has a stock price currently fluctuating between $4 and $5. Ericsson recently spiked up to around $11, but it may drop down to below $10 again.
Where can I buy 5G stocks?
Why invest in 5G?
Anyone looking for high-growth stocks to invest in should consider companies involved in 5G. The best time to invest in a company is before its technology achieves mainstream success because the stock price remains undervalued. This may be where we stand now with 5G. According to forecasts, there will be around 120 million 5G smartphone shipments in 2020, showing a vast market.
We’re still yet to know whether 5G will take the world by storm or slide into the background, but chances are that it’s here to stay.
As we stand on the brink of mass 5G network deployment and a huge upgrade involving major phone companies like Apple, it’s a vital moment for investors. Will you get involved or stay on the sidelines?
If you’re looking to invest in a stock related to upcoming technology, these stocks should be given serious consideration.
In The Game Investing is long in AAPL and has no positions in the other stocks mentioned. No shares/stocks will be sold within the next 10 days from publication. Tim Thomas has no positions in the stocks mentioned. YMG and Wealth of Geeks have no positions in the stocks mentioned. YMG has a disclosure policy.
Tim Thomas was born in Guildford and now lives near Southampton, the UK with his family. Tim started his career in the financial markets and has traded and invested in stocks, options, forex, futures, crypto, and real estate for over 20 years. His website, https://timthomas.co/, is dedicated to teaching swing trading strategies for profits, helping traders reach their wealth and financial freedom goals.