Why American Tower Corporation (AMT) Is Among the Best 5G Stocks to Invest in According to Analysts?
5G technology is the fifth generation of wireless cellular technology that offers significant improvements in speed, latency, and capacity. The 5G technology industry is expected to experience rapid growth, fueled by the technology's potential to revolutionize various sectors such as telecommunications, the Internet of Things (IoT), and private networks. According to a report by The Business Research Company, the global 5G technology market was valued at $27.91 billion in 2024. The market is expected to grow exponentially at a compound annual growth rate (CAGR) of 46.7% during 2025-2029 to reach a value of $210.98 billion by the end of the forecast period. In 2024, North America was the largest region in the global 5G technology market.
READ ALSO: 10 Best Stocks to Buy and Hold For 2025 and 10 Best Sin Stocks to Invest in 2025.
This growth in the 5G technology industry is supported by the growing demand for high-speed data connections and low latency, which are crucial for various new technologies and applications. Technologies like self-driving cars, advanced gaming, and live streaming require high-speed data connections. Additionally, the rise of new technologies such as IoT, Artificial Intelligence (AI), and automation is leading to a surge in the amount of data created, further driving the demand for 5G connectivity.
In March 2024, CNBC reported that telecom operators are still rolling out 5G wireless mobile networks, but are already talking about creating '5.5G' or '5G Advanced.' This was a major topic of discussion at the Mobile World Congress in Barcelona, where leading telecom companies shared their plans for the development of a new generation of mobile internet technology.
This technology could power more advanced applications in the future, including mixed-reality headsets. Additionally, its applications could also include self-driving cars, unpiloted air taxis, and smart manufacturing.
Milind Kulkarni, the vice president and head of InterDigital's wireless labs, told CNBC that the main reason for developing 5G Advanced standards is to make 5G more commercially relevant by expanding into different industries, resolving deployment problems, and continuing to improve the technology to create a bridge towards the next generation of wireless networks, known as 6G.
He further pointed out that researchers have been working on new enterprise-specific features for 5G Advanced that are designed for businesses. These include network slicing, the integration of private and public networks, and customized applications that are tailored to meet the specific needs of different industries.
The benefits and applications of 5G technology seem to be vast and virtually boundless, with significant opportunities for innovation and growth.
To compile our list of the 10 best 5G stocks to invest in according to analysts, we reviewed our own rankings, financial media reports, and various online resources to compile a list of the best 5G stocks. Next, we focused on the top 5G stocks that analysts believe have the most potential for growth. We ranked the 10 best 5G stocks to buy based on their average price target upside potential according to analysts as of January 24, 2024.
Additionally, we mentioned the hedge fund sentiment surrounding each stock, which was taken from Insider Monkey's Q3 2024 database of 900 elite hedge funds.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A wide angled view of a high-rise office building, the windows reflecting a nearby cityscape.
Average Price Target Upside Potential According to Analysts: 29.40%
Number of Hedge Fund Holders: 73
American Tower Corporation (NYSE:AMT) is an American real estate investment trust (REIT) that provides the infrastructure for modern digital communications. It owns, develops, and operates wireless and broadcast communications infrastructure in 24 countries across 6 continents. With a portfolio of over 148,000 communications sites and a network of data centers in the US, American Tower Corporation (NYSE:AMT) serves mobile network operators, major telecommunications companies, and media and broadband providers. AMT ranks among the best 5G stocks to buy.
The company plays a crucial role in the 5G industry by supporting the networks through its wireless infrastructure sites. In the third quarter of 2024, American Tower Corporation (NYSE:AMT) reported ongoing growth and expansion of 5G coverage, driven by carrier rollouts in the US and Europe. The company is seeing a healthy pipeline of new business fueled by network upgrades and coverage expansion.
, an investment management company, has a positive outlook on American Tower Corporation (NYSE:AMT). In its 'Strategic Growth Strategy' third quarter 2024 , the investment management firm noted that AMT experienced a significant rebound in the third quarter of 2024 by surging nearly 20%. This appreciation was driven by the decrease in interest rates. However, Mar Vista Investment Partners believe that the long-term global opportunities for 5G deployment, edge-of-network computing, and datacenters, remain promising and are not fully reflected in American Tower Corporation's (NYSE:AMT) current stock price.
Overall, AMT ranks 4th on our list of best 5G stocks to invest in according to analysts. While we acknowledge the potential of 5G companies, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
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