AT&T, EA, Advanced Micro Devices, and Nvidia look like some of the best 5G stocks to buy as cloud gaming takes the industry by storm
While coronavirus and the upcoming presidential elections have commanded investors’ attention lately, the rollout of 5G across the country could be another significant catalyst for the U.S. stock market.
Just about every aspect of the tech space will probably benefit from the new network. But gaming, which has seen impressive growth over the past year, could be the best place to find 5G stocks to buy.
A survey conducted by Ribbon Communications Inc. found that gamers are not only anxiously awaiting the full rollout of 5G services, but they’re ready and willing to pay more for the gaming experience it will offer.
Notably, the survey included only gamers who were playing three hours per day or more before the pandemic hit. Since that time, the number of gamers worldwide has skyrocketed as people turn to online entertainment from the confines of their homes.
The results of the Ribbon survey are clear: cloud gaming bolstered by 5G networks is going to be huge. The beneficiaries will range from game-makers to devices and chipmakers, but it’s the carriers who stand to make the biggest gains.
Ribbon’s research found that 95% of the gamers were willing to pay more for an improved gaming experience. A whopping 60% said they’d be ready to double their monthly bill to enjoy the experience that 5G has promised.
The research clearly shows that these avid gamers present a highly addressable audience for carriers. They are aware of the internet speeds they receive, understand the detrimental impact of latency on their gaming experience, and are prepared to spend what it takes to negate these issues
That’s huge for AT&T, whose 5G network is already up and running for millions of customers. Not only is T stock poised to benefit from an influx of gamers looking to get on a 5G network ASAP, but the firm’s other assets—particularly its streaming service—offer investors a more diversified approach to betting on the improving gaming landscape.
Electronic Arts is the company behind the soccer gaming phenomena Fifa and the popular football franchise Madden NFL. Both have seen users and online engagement skyrocket amid the pandemic, a trend that will likely continue as professional sports struggle to resume fully.
EA is also well-positioned to benefit from the excitement surrounding cloud gaming via Project Atlas, its cloud gaming platform. EA hasn’t offered much information regarding the platform since 2018 when it was first revealed.
Ultimately, that doesn’t matter because EA owns the content that gamers want to play and people want to watch—sports. That means the firm’s cloud gaming platform will be in high demand whenever it’s ready to go.
Another place to look for quality 5G stocks to buy is in the semiconductor space.
Advanced Micro Devices makes CPU and GPU chips for a range of different products, including Mircosoft’s Xbox console and Google’s Stadia cloud gaming platform. As noted in the Ribbon survey, gamers will pay a premium for the best possible experience, so as long as AMD continues to make quality chips, the firm’s products will be in demand.
NVDA is another chipmaker offering a similar growth story to AMD. While NVIDIA is best-known for its GPU chips that power cloud gaming services and data-centers, the firm is pushing outside the semiconductor space with its cloud gaming platform, GeForce. It remains to be seen whether GeForce will break into the gaming world with so many well-established competitors out there, but it makes for an interesting play for 5G investors.
Disclaimer: This article represents the author’s opinion and should not be considered investment or trading advice from CCN.com. Unless otherwise noted, the author has no position in any of the securities mentioned.
Last modified: September 23, 2020 2:31 PM