With 5G poised to take off this year, you may be wondering what the best 5G stocks to buy and add to your retirement portfolio? Find out in today’s article.
5G Stocks to Buy This Year | 7 Stocks to Consider for Your Retirement Portfolio
1. Apple (AAPL)
- Revenue (Q4 2019): $64 billion
- Stock Price (as of 01/24/2020): $319.83
- Dividend Amount (Recorded 11/11/2019): $0.77
While the latest iPhones aren’t 5G-capable yet, insiders predict that Apple will soon have them. As one of the most innovative wireless companies, the company will continue to hold a substantial mobile market share.
More than its market leadership position and blue-chip status, Apple boasts of a solid dividend payment record. Even though its latest dividend yield of 1.05% may not seem that significant, its dividends have been increasing since 2012.
2. Corning (GLW)
- Revenue (Q3 2019): $3 billion
- Stock Price (as of 01/24/2020): $29.31
- Dividend Amount (Recorded 11/15/2019): $0.20
If the company doesn’t sound familiar, its flagship product – Gorilla Glass – might. It’s the ultra-hard glass cover of most smartphones’ screens, including two of the biggest international brands: Samsung and Huawei.
When 5G networks completely roll out in the U.S. and internationally, the number of 5G-capable devices will boom, too. Because Gorilla Glass protects most smartphone brands’ screens, Corning’s business will most likely enjoy huge growth.
Corning’s looming 5G-related boom isn’t just about Gorilla Glass, though. The bulk of its expected 5G-related business boom will come from another of the company’s products: fiber optic cables.
This is because only fiber optic cables can handle 5G networks. As a result, things are looking even brighter for Corning, being the industry leader in the fiber optics business, with a 16.3% market share.
3. AT&T (T)
- Revenue (Q3 2019): $44.6 billion
- Stock Price (as of 01/24/2020): $38.48
- Dividend Amount (Recorded 01/10/2020): $0.52
AT&T is one of only three companies that will offer 5G wireless in the U.S. As such, it automatically qualifies as one of the most important 5G industry players in the United States.
One of the reasons why there will only be three expected 5G players in the U.S. is capitalization. Rolling out 5G networks across the country requires cash – and truckloads of it.
AT&T is one of the few companies that have the money to roll out an extensive U.S. 5G network. Given the high entry barriers to 5G, AT&T won’t have to worry about more competition than what it already has.
While the costly upgrades to 5G, intense competition, and rampant cord-cutting present challenges to AT&T, there are silver linings. Its stock price was up by over 37% in 2019 with a P/E ratio of about 14 times.
More importantly, AT&T’s dividend record is nothing short of spectacular. Why?
- Its average annual dividend yield is nearly thrice that of the average for the S&P 500 average at 5.30%.
- The company has increased its dividend payouts every year for the last 34 years.
This gives investors reasons to believe that more likely than not, AT&T’s dividends will continue to increase every year. Hence, it’s one of the top 5G stocks to buy in 2020.
4. Skyworks Solutions (SWKS)
- Revenue (Q1 2020): $896 million
- Stock Price (as of 01/24/2020): $122.09
- Dividend Amount (Recorded 12/03/2019): $0.44
This company produces analog chips for over a million mobile electronic products that are connected to Wi-Fi networks, such as smartphones.
In the early months last year, up to 75% of the company’s revenues came from chips used for smartphones. The remaining revenues came from chips that power the Internet of Things (IoT) electronic devices.
The expected growth of 5G networks and services will require a new generation of compatible electronic devices (like smartphones). These new-generation devices need new generation components, too, such as 5G-compatible switches, bands, and filters.
With the expected demand for a new generation of 5G-compatible electronic devices, manufacturers’ demand for necessary components will go up, too. Hence, Skyworks can benefit greatly from the expected growth of 5G in the U.S. and internationally, too.
5. Cisco Systems (CSCO)
- Revenue (FY 2019): $51.9 billion
- Stock Price (as of 01/24/2020): $48.97
- Dividend Amount (Recorded 01/03/2020): $0.35
For most investors, Cisco has been synonymous with the breakout of the Internet during the 1990s. It’s because Cisco was the biggest producer of Wi-Fi routers during those times.
Despite resembling a traditional industrial stock more than a growth tech one, Cisco is still a major tech company. It remains to be one of the biggest Internet infrastructure companies around.
Given its leadership position in the Internet infrastructure industry and the expected boom in 5G, Cisco’s poised to benefit.
Unlike the 90s, the company is now paying dividends, which began in 2011. Even better, each succeeding year’s dividend payments were higher than the previous, with an average yield of about 3%.
6. Verizon (VZ)
- Revenue (Q3 2019): $32.9 billion
- Stock Price (as of 01/24/2020) : $60.51
- Dividend Amount (Recorded 1/10/2020): $0.615
There are three reasons why Verizon is one of the best 5G stock bets this 2020:
- It beat the other major U.S. telecoms players in terms of laying down data transmission networks that pass international 5G standards.
- Verizon was the first in the world to roll out commercial 5G services for all of its nationwide subscribers.
- The company plans to offer 5G to 30 million subscribers in the United States from 2019 to 2026.
These are clear indications that of the three major U.S. telecoms companies, Verizon has established 5G market leadership.
7. Nokia (NOK)
- Revenue (Q3 2019): €5.7 billion
- Stock Price (as of 01/24/2020): $4.05
- Dividend Amount (Recorded 07/30/2019): $0.056
The company may seem to have retreated into oblivion after ruling the cellular phone market until the early 2000s. But in the last few years, it has made great strides in two ways.
- It finally came out with its own smartphone.
- The company has established itself as one of the leading suppliers of wireless communications network equipment. In particular, Nokia is now one of the world’s leading providers of 5G network hardware equipment.
The proof is in the pudding. Consider that Nokia entered into a $3.5 billion contract with T-Mobile. Under the said contract, Nokia will provide practically all of T-Mobile’s 5G network requirements, from hardware to software and services.
For those looking to add growth potential to their retirement investment portfolios, these are seven of the best 5G stocks to buy this year. They have the benefit of being relatively “mature” stocks, with the addition of high growth potential due to 5G’s expected rapid growth.
Do you have other top 5G stocks to buy that aren’t on this list? Let us know in the comments section below!