Fixed wireless access (“FWA”) has emerged as a key technology over the past few years, owing to its inexpensive services and ability to raise the speed of present broadband connections. Combined with 5G, the capabilities of the technology span even wider and offer an even better return on investment.
After all, FWA is a type of wireless broadband data communication that exists between two fixed destinations. The locations are connected via permanent wireless access devices and equipment, making FWA pocket-friendly for network communications across big cities as well as areas that are less densely populated.
Since FWA is the latest technology in the universe of wireless network technologies, the reach and applicability of 5G fixed wireless access are only set to grow. This is why one could consider tracking stocks that have significant operations in the said space.
5G FWA Market Promises Growth, Here’s Why
The fast-growing popularity of 5G fixed wireless access is a result of the rising demand for fast and reliable Internet even in the remote corners of the world. After all, high-speed Internet with broad coverage, lesser network latency and power usage is the need of the hour, given that commercial centers and residences across the world are increasingly relying on electronic products that require it.
The technology makes it possible to raise the speed of existing broadband connections without any engineering modifications at customers’ end. The technology has provision for Customer Premise Equipment, which can be installed easily by a subscriber.
According to MarketsandMarkets, the 5G fixed wireless access market has shown impressive growth during the 2019–2026 forecast period. The market is expected to to reach $46,366 million by 2026 from $396 million in 2019, at a compound annual growth rate of 97.47%.
This anticipated growth also finds its basis on 5G FWA’s ability to deliver services that could be on par with fiber-based broadband networks and offer much higher data speeds than regular broadband standards. This is why 5G FWA is expected to have a considerable impact across major cities as well as rural, remote regions across the United States and abroad.
3 Stocks Trying to Tap into 5G FWA
We have highlighted three stocks that already have or are working toward a robust 5G fixed wireless access infrastructure. We anticipate these stocks to gain in the future on the back of these operations. In addition, all of these stocks carry a Zacks Rank #2 (Buy) or 3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cisco Systems, Inc. (CSCO) launched a number of initiatives in February that focus on the company’s service provider side. Cisco has made considerable progress in its fixed wireless access services. The company’s Cisco Cloud Services Stack for Mobility offers a platform for operators to bring 5G services to customers with all the required tools for computing, networking and management.
Cisco Systems’ expected earnings growth rate for current year is 1.6%. Shares of the company, which belongs to the Zacks Computer – Networking industry, have gained 26% over the past three months compared to the industry’s gain of 25.7% during the same period. Cisco Systems carries a Zacks Rank #2.
Both AT&T Inc. (T) and Verizon Communications Inc. (VZ) are marching ahead in the area of 5GFWA, as both companies are working on various stages of using the technology to target small business customers. Verizon is testing a version of its fixed wireless 5G Home service called 5G Office that is aimed for business users.
AT&T launched its new fixed wireless Internet service last year. The company plans to expand the service into 5G this year.
AT&T’s expected earnings growth rate for next year is 4.9%. Shares of the company, which belongs to the Zacks Wireless National industry, have gained 11.5% over the past month compared to the industry’s gain of 6.6% during the same period. AT&T carries a Zacks Rank #3.
Verizon Communications’ expected earnings growth rate for next year is 3.2%. Shares of the company, which belongs to the Zacks Wireless National industry, have gained 3.5% over the past three months compared to the industry’s gain of 2.7% during the same period. Verizon Communications carries a Zacks Rank #3.
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