The Motley Fool

The Best Canadian 5G Stock to Buy Right Now

Image source: Getty Images

The 5G revolution is one that is perhaps less exciting than other paradigm shifts in the market. Indeed, the growth catalyst 5G provides for the telecom sector is one that’s a long burn. It will take many years for investors to reap the benefits of the infrastructure improvements telecom players are making today.

However, it’s undeniable the improvements that are coming via 5G. Improved data speeds and minimized latency provide a data-hungry user base with better, faster connectivity. And companies like Rogers Communications (TSX:RCI.B)(NYSE:RCI) are leading the way in bringing this technology to the masses.

Here is the key reason why investors are honing in on Rogers as an excellent long-term 5G pick.

Shaw Communications deal provides a tonne of potential upside

Without a doubt, the $20 billion takeover bid for Shaw Communications (TSX:SJR.B)(NYSE:SJR) is huge for investors. Indeed, it appears that there is a lot of optimism in relation to this acquisition. However, I expect this merger to be more beneficial for Rogers than Shaw.

Rogers will be able to roll out the 5G technology much faster than the other players in the market. Furthermore, this deal allows the company to expand its operations in Western Canada, which requires a significant amount of investment when it comes to 5G infrastructure.

Once this acquisition is complete, Rogers will become the second-largest telecommunications company in the country. It will overtake Telus to compete with BCE, which is currently leading the market. There’s huge upside for shareholders considering the potential size of this company following the completion of this takeover. Indeed, there’s plenty of optimism among analysts in relation to the potential value that could be generated once this acquisition is complete.

The acquisition is not a done deal yet

Investors must note that there’s still a lot of speculation going on as to whether this deal will eventually materialize or not. Since this takeover will be a game changer for the telecommunications space, a regulatory review will take place. Nevertheless, it appears that there’s a tonne of optimism around the deal going through right now.

Canada has a reputation for having a relatively lenient regulatory process when compared to that of other countries. Indeed, regulators of this country have given the green light to big deals similar in size and scale to this one recently. Accordingly, the market appears to be correctly pricing in lower regulatory risk with this deal today.

Indeed, I think if Rogers were to tie up with an international counterpart, this risk level would be much higher and would be priced accordingly.

Bottom line

With the race to 5G supremacy on, now’s the perfect time to start considering the best way to play this space. For those who believe this major acquisition will take place, Rogers is a great bet today.

Like this top 5G pick? Then you definitely need to read this:

Motley Fool Canada Makes 5G Buy Alert

5G is one of the greatest arrivals in technology since the birth of the internet. We could see plenty of new wealth-building opportunities in 2021 that would potentially dwarf any that came before them.

5G has the potential to radically change our lives and society as we know it, but if you’re an investor, the implications are even greater — and potentially much more lucrative.

To learn more about it and its revolutionary potential to change the industry — and potentially your bank account — click on the link below to get the full scoop.

Learn More Today!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.