Global 5G subscriptions are projected to double and surpass 1 billion in 2023, driving the rapid construction of 5G mobile networks. The demand for 5G infrastructure will likely increase by 22% this year, reaching over $23 billion worldwide. With its lower latency and significantly faster download speeds, 5G represents the next generation of wireless networking technology.
That said, 5G stocks are some of the most attractive investments for investors looking to capitalize on the potential of this new technology. Here are three 5G stocks poised to deliver triple-digit returns.
Qualcomm (QCOM)
Qualcomm (NASDAQ:QCOM) achieved a significant AI milestone by successfully running the Stable Diffusion text-to-image generative AI service on an Android smartphone, showcasing its innovation in the field.
Generative AI involves two steps: training and inference. During training, the algorithm learns from a vast dataset of human-created images and corresponding text descriptions. Once trained, the algorithm can generate new images based on user input, a process known as inference. Importantly, Qualcomm demonstrated this capability on a smartphone by inputting the prompt: “Super cute fluffy cat warrior in armor, photorealistic, 4K, ultra-detailed, Vray rendering, unreal engine.”
Qualcomm has made significant progress in on-device AI inference, potentially surpassing Apple (NASDAQ:AAPL) in the realm of generative AI. Thus, with a low valuation and its smartphone market business nearing a cyclical bottom, Qualcomm presents an appealing investment opportunity. Trading at favorable multiples, it stands as a strong contender among 5G stocks in the AI sector.
Broadcom (AVGO)
Broadcom (NASDAQ:AVGO) is an undervalued chip stock that has recently gained attention from investors. With solid growth, strong margins and a high dividend yield, the company’s stock experienced a significant rally. However, despite a slight pullback, Broadcom’s strong earnings results have continued to attract buyers. Indeed, this is a stock I think has more upside potential from here.
With strong growth and the rise of artificial intelligence, semiconductor giant Broadcom has the potential to surpass a $1 trillion valuation. This would place it alongside Nvidia (NASDAQ:NVDA) as a beneficiary of the AI boom. Semiconductor chips, essential for AI and various products like computers, cars, smartphones and appliances, contribute to Broadcom’s success.
AVGO stock has surged 58% as the chip sector rebounds, driven by strong semiconductor demand and the growth of artificial intelligence. A partnership with Apple adds to the company’s revenue and earnings growth prospects. With robust profit margins and steady free cash flow, AVGO is expected to maintain a range of $17 billion to $18 billion until 2030.
Skyworks Solutions (SWKS)
Skyworks Solutions (NASDAQ:SWKS) is a semiconductor company that specializes in Internet of Things (IoT) technology. Indeed, with a focus on 5G and IoT opportunities, the company provides front-end modules for various industries such as connected homes, industrial, medical, smart energy and wearables. Notably, Skyworks Solutions aims to connect data from sensors through its cellular architecture.
Analysts and technical analysis screeners suggest that SWKS stock is undervalued, with an estimated upside ranging from $15 to $70 per share. Skyworks Solutions has outperformed revenue expectations, achieved record cash flows, and established partnerships in promising growth areas like information technology (IT), electric vehicles (EVs) and data centers. With a revenue growth rate surpassing most competitors, the company’s strong performance supports the optimistic outlook.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
