The 5G rollout in the U.S. has been in the news lately. The telecom giants like Verizon and AT&T have decided to delay the deployment near key airports due to concerns related to air-traffic safety. Nonetheless, the 5G tech went live in most parts of the country earlier this week with nearly 90% wireless tower deployment. Let’s take a closer look at how investors could benefit from this latest trend.
Invest in top 5G stock in Canada
The 5G, or the fifth-generation, technology for broadband cellular networks is likely to massively improve wireless data transfer speed and reliability. These speed and reliability factors could play a transformational role for new advancements in several industries, including transportation, manufacturing, financial services, and hospitality.
Given that, some fundamentally strong 5G stocks could see a big rally in the coming years. That’s why if you don’t already own 5G stocks, you may want to add them to your portfolio right now to get handsome returns on your investments. Here’s my top 5G stock pick in Canada that long-term investors can consider buying now.
BCE stock
BCE (TSX: BCE)(NYSE: BCE) is the largest communications company in Canada, with a market cap of about $60.2 billion. Its stock is currently trading at $66.29 per share without any major year-to-date change after posting 21% gains in 2021. The company operates through three key brands: Bell wireline, Bell wireless, and Bell media.
Leading the 5G rollout
Bell was the first company in Canada to start the trial of mobile 5G technology. In June 2020, it launched its 5G wireless network in Montréal, the Greater Toronto Area, Calgary, Edmonton, and Vancouver. Last year, the company expanded its 5G network to 23 new markets across Québec, Ontario, and Manitoba.
In the last few quarters, BCE has focused on “further expanding mobile 5G coverage and deploying 3.5 gigahertz capable radios,” as its management expects to launch “true 5G” services in 2022.
How 5G could boost its financial growth
While BCE is yet to announce its December quarter results, Street analysts expect BCE to report a 4.7% year-over-year adjusted earnings growth in the full year 2021. Its earnings-growth rate is estimated to accelerate further in the next couple of years with its true 5G rollout and consistently strengthening network across Canada.
During BCE’s Q3 earnings conference call, its CEO Mirko Bibic highlighted that “5G customers continue to spend more than 4G customers” with significantly higher data usage. As a result, higher adoption of 5G tech could help BCE accelerate its financial growth in the coming years. while BCE stock hasn’t seen much appreciation lately, these positive trends could drive this top 5G stock higher.
5G stock with solid dividends
Besides its strong fundamental outlook, BCE stock also offers attractive dividends to its investors. In 2020, the company increased its dividends by about 5% from a year ago, despite facing COVID-related uncertainties. Currently, BCE stock has a handsome dividend yield of around 5.3%, making this Canadian 5G stock even more attractive for long-term investors.
