Fifth-generation (5G) mobile networks are now being activated in the U.S. and around the world. In fact, the market is on the verge of exploding. That means investors should be looking into 5G stocks for their next big move.
According to Allied Market Research, the worldwide 5G tech market will grow to $667.9 billion by 2026. That’s up from $5.5 billion this year for a compound annual growth rate (CAGR) of 122.3%. The massive growth is because 5G will radically influence global communications, cloud-computing, the Internet of Things (IOT) and more.
So, here are seven 5G stocks to buy in November in order to ride the trend.
- Nvidia (NASDAQ:NVDA)
- Cisco (NASDAQ:CSCO)
- Crowdstrike (NASDAQ:CRWD)
- Marvell Technology (NASDAQ:MRVL)
- Qualcomm (NASDAQ:QCOM)
- Ericsson (NASDAQ:ERIC)
- Alibaba (NYSE:BABA)
Best 5G Stocks to Buy: Nvidia (NVDA)
First on my list of 5G stocks is microchip manufacturer Nvidia, which is set to report its latest quarterly earnings on Nov. 18. Needless to say, analysts are expecting big things. Wall Street analysts project the California-based company to “earn $2.56 a share on sales of $4.41 billion.” A year before, Nvidia’s earnings came in at $1.78 a share on $3.01 billion in sales.
Driving much of this growth has been the company’s strong sales of graphics processors for gaming computers and data centers. Nvidia is also in the process of completing its acquisition of chip designer Arm from SoftBank (OTCMKTS:SFTBY). Announced on Sept. 13, the $40 billion deal will allow Nvidia to move further into data centers with servers driven by central processing units (CPUs). That would challenge Intel (NASDAQ:INTC) and Advanced Micro Devices (NASDAQ:AMD) in the server CPU market.
In terms of 5G, NVDA stock should see a nice boost as its graphics cards are integral to data centers, computers and 5G networks, too. The company has also partnered with Ericsson in order to improve the efficiency and intelligence of 5G networks in the U.S. and beyond. The partnership aims to close gaps in network infrastructures where carriers can’t use bandwidth.
So, as 5G becomes standard in coming years, Nvidia is positioned to be a prime beneficiary. On top of that, NVDA stock has already had an incredible run this year, up 179% from its March low. While the share price has softened a bit in recent weeks at around $540, analysts remain extremely bullish. The median price target on the stock is $600 a share, with a high estimate of $700.
Cisco is one of the few technology companies experiencing an uptrend in November, making it one of the hottest 5G stocks on this list. CSCO stock jumped a little under 7% on Nov. 13 after the manufacturer of networking hardware and telecommunications equipment reported Q1 revenue of $11.9 billion and earnings per share (EPS) of $0.76. Both results beat a consensus of $11.8 billion and $0.70 EPS.
Finally, Cisco is deep into 5G. Recently, the company announced a partnership with AT&T to enhance 5G’s role in the Internet of Things. The company is also helping build the networks needed to seamlessly run 5G in places like Japan. Additionally, Cisco is involved in backhaul and packet core work with 5G networks as well as radio access networks (RAN). CEO Chuck Robbins even highlighted the company’s 5G work in his recent earnings call with analysts and media.
Analysts see CSCO stock running higher in coming months. The median price target is $49 a share, with a high estimate of $60.
Of course, as the 5G rollout gains steam, there will be greater need for endpoint security. Few companies do that as well as Crowdstrike. The California-based company is an expert when it comes to providing workload protection across various endpoints — including cloud computing, mobile devices and IOT devices. Moreover, the company’s protection modules are only going to grow as 5G becomes the dominant network around the world.
But Crowdstrike is already going gangbusters, having grown its revenues from $52.7 million in 2017 to $654.3 million over the past 12 months. On top of that, more than half of the company’s customers have purchased four or more of the company’s modules, while over 35% have purchased five or more. CRWD stock has been plowing ahead this year, up nearly 238% from its March low of $32.12 to around $133 today.
Analysts who cover CRWD stock feel it has even more room to run. The median price target calls for the stock price to rise to $160 a share, with a high price target of $176. Out of the 22 analysts covering the company, 17 have “buy” ratings for this pick of the 5G stocks.
Marvell Technology (MRVL)
While companies like Nvidia tend to get all of the attention, you shouldn’t count out semiconductor company Marvell Technology. That’s because many people on Wall Street see the firm as one of the best plays out there when it comes to 5G stocks. Those who cover the industry respect Marvell for its experience in supporting mobile networks, which dates back to 3G. In fact, CNBC host Jim Cramer has dubbed the company “Mr. 5G.”
Right now, Marvell is largely focused on “breakthrough end-to-end solutions” for 5G infrastructure deployments. In addition to helping build out the 5G architecture, Marvell has also joined forces with Nokia (NYSE:NOK). The company will be filling out some of Nokia’s “technical gaps” as it moves into the 5G arena.
Of course, this all puts Marvell in a prosperous position for the 5G revolution. MRVL stock has more than doubled this year to over $43 a share. The median price target on the stock is $48 a share, with a high estimate of $60.
On Nov. 11, Qualcomm generated some buzz when it came out that satellite TV giant Dish (NASDAQ:DISH) had signed an agreement enlisting the wireless tech company to build out its 5G network. That makes QCOM one of the more promising 5G stocks on the market right now.
Dish’s 5G network is to be rolled out domestically by 2023 “using open and cloud-based platforms.” Moreover, the TV provider is building its U.S. network with relatively new RAN technology, “reducing the need for physical equipment.” Qualcomm’s 5G RAN platforms will be the basis of Dish’s entire 5G network.
But Qualcomm’s new deal with Dish is not the only advantage the company has — QCOM will also benefit from Apple’s recent move to 5G with the new iPhone 12. That’s because Qualcomm is a leading supplier of the microchips used in 5G smartphones. The company projects up to 550 million 5G smartphone shipments in 2021. That’s a massive market that will propel revenues and QCOM stock even higher.
Currently, QCOM’s share price is up over 145% from its March low to $149 today. Analysts project a median price target of $159 a share and a high price target of $194.
One of Sweden’s top tech companies, Ericsson is a leader in building network infrastructure for the global advancement of 5G. Currently, Ericsson’s 5G work is concentrated in China, where it’s helping major wireless providers like China Mobile (NYSE:CHL) establish their networks. The Swedish company is also helping create several of the country’s “smart cities.” The Chinese smart city initiative is forecast to be worth $3.4 trillion by 2022.
Other than China, Ericsson is also making 5G network progress in countries like Spain, the U.K. and South Korea. In Switzerland, Ericsson has built networks that can accommodate 98% of the country’s population. Ericsson also recently made a deal to buy wireless networking firm Cradlepoint for $1.1 billion in the United States. The agreement “gives the company access to tools that can connect electronic devices to the Internet of Things (IoT) over 5G networks.”
So, ERIC stock looks like a steal at its current price of just over $12. That’s up 96% from its March low. Analysts now project a median price target of $13.75 for this one of the 5G stocks, with a high estimate of $15.83.
The last pick on my list of 5G stocks is Alibaba, a Chinese firm that has its hands in all kinds of technology. It should come as no surprise, then, that the company is also a leader in 5G networks and applications. Alibaba has even established a research lab for the development of 5G technologies.
Officially known as the Alibaba XG Lab, the 5G center’s research focuses on the development of 5G applications related to e-commerce, entertainment and virtual reality. These efforts have also been encouraged by the Chinese government, which is pushing for the entire country to “rapidly deploy 5G based stations.” In other words, Alibaba is helping put China at the forefront of cutting-edge technology.
Beyond its lab, Alibaba has also made an investment in China Broadcasting Network — a cable TV operator and new entrant in China’s telecom sector — in order to advance its 5G spectrum. Clearly, 5G is one of Alibaba’s top priorities.
Of course, this should all help underpin BABA stock moving forward. The stock is now at over $257, up 51% from its March low. And while the price can be volatile and jump around (BABA was recently up to $319 a share), analysts expect shares to stabilize and grow as U.S. relations with China cool under President-elect Joe Biden.
So, big growth is expected in the near future for Alibaba. Analysts have a median price target on the stock of $2,324 over the next 12 months, suggesting potential growth of over 800%.
At the time of publication, Joel Baglole held long positions in APPL, BABA and NVDA.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.