We recently published a list of 10 Best 5G Stocks to Invest in According to Analysts. In this article, we are going to take a look at where Telefónica S.A. (NYSE:TEF) stands against other best 5G stocks to invest in according to analysts.
5G technology is the fifth generation of wireless cellular technology that offers significant improvements in speed, latency, and capacity. The 5G technology industry is expected to experience rapid growth, fueled by the technology’s potential to revolutionize various sectors such as telecommunications, the Internet of Things (IoT), and private networks. According to a report by The Business Research Company, the global 5G technology market was valued at $27.91 billion in 2024. The market is expected to grow exponentially at a compound annual growth rate (CAGR) of 46.7% during 2025-2029 to reach a value of $210.98 billion by the end of the forecast period. In 2024, North America was the largest region in the global 5G technology market.
This growth in the 5G technology industry is supported by the growing demand for high-speed data connections and low latency, which are crucial for various new technologies and applications. Technologies like self-driving cars, advanced gaming, and live streaming require high-speed data connections. Additionally, the rise of new technologies such as IoT, Artificial Intelligence (AI), and automation is leading to a surge in the amount of data created, further driving the demand for 5G connectivity.
In March 2024, CNBC reported that telecom operators are still rolling out 5G wireless mobile networks, but are already talking about creating “5.5G” or “5G Advanced.” This was a major topic of discussion at the Mobile World Congress in Barcelona, where leading telecom companies shared their plans for the development of a new generation of mobile internet technology.
This technology could power more advanced applications in the future, including mixed-reality headsets. Additionally, its applications could also include self-driving cars, unpiloted air taxis, and smart manufacturing.
Milind Kulkarni, the vice president and head of InterDigital’s wireless labs, told CNBC that the main reason for developing 5G Advanced standards is to make 5G more commercially relevant by expanding into different industries, resolving deployment problems, and continuing to improve the technology to create a bridge towards the next generation of wireless networks, known as 6G.
He further pointed out that researchers have been working on new enterprise-specific features for 5G Advanced that are designed for businesses. These include network slicing, the integration of private and public networks, and customized applications that are tailored to meet the specific needs of different industries.
The benefits and applications of 5G technology seem to be vast and virtually boundless, with significant opportunities for innovation and growth.
Methodology
To compile our list of the 10 best 5G stocks to invest in according to analysts, we reviewed our own rankings, financial media reports, and various online resources to compile a list of the best 5G stocks. Next, we focused on the top 5G stocks that analysts believe have the most potential for growth. We ranked the 10 best 5G stocks to buy based on their average price target upside potential according to analysts as of January 24, 2024.
Additionally, we mentioned the hedge fund sentiment surrounding each stock, which was taken from Insider Monkey’s Q3 2024 database of 900 elite hedge funds.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Is Telefónica S.A. (TEF) the Best 5G Stock to Invest in According to Analysts ?
An executive speaking in front of a large audience of business men and women, speaking on the importance of telecommunications services.
Average Price Target Upside Potential According to Analysts: 19.61%
Number of Hedge Fund Holders: 9
Telefónica S.A. (NYSE:TEF) is a Spanish multinational telecommunications company. Operating in Europe and the Americas, it is one of the world’s largest telephone operators and mobile network providers. While the company operates in 12 countries, it has a presence in 41 markets around the world. Telefónica S.A. (NYSE:TEF) is one of the best 5G stocks to buy according to analysts.
The company has been investing in fiber and 5G infrastructure to drive customer growth and satisfaction. As of September 2024, Telefónica S.A. (NYSE:TEF) reported 393 million accesses, up 2% versus September 2023. The company reported notable growth in both fiber and mobile contract customers.
Telefónica S.A. (NYSE:TEF) is actively looking to improve 5G technology and expand its 5G network. This strategic focus on 5G expansion seems to be paying off. By the end of September 2024, Telefónica S.A. (NYSE:TEF) reached 71% 5G coverage in its 4 core markets to meet its target of reaching 70% more than two years ahead of schedule. By September 2024, 5G technology covered 90% of the population in Spain, 97% in Germany, 68% in the UK, and 57% in Brazil.
Overall, TEF ranks 9th on our list of best 5G stocks to invest in according to analysts. While we acknowledge the potential of 5G companies, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TEF but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
