5G Rollout: Why Ericsson (ERIC) is a great long term buy

For investors looking to capitalize on the coming 5G rollout through telecommunication networks, Ericsson (ERIC) is a good place to start looking.

The company is developing 5G networkds around the world which is required to run the next generation of smart phones, tablets, computers and the Internet of Things (IoT).

According to a market outlook report, the 5G market is poised to explode in the next five years, growing from $5 billion in 2021 to nearly $669 billion by 2026. If Ericsson is able to cut a small percentage of that, then that would be a huge reward for shareholders.

Ericsson (ERIC) grows in China

The company right now is concentrating largely in China, where the company is helping major wireless providers like China Mobile (CHL) get their networks up and running with the assistance of smart cities that are internet connected.

China’s smart city initiative (which Beijing government supports) is forecasted to be worth more than $3 trillion by 2022. Ericsson currently has contracts in place with all three of China’s major wireless carriers. With China being purportedly the largest 5G market on the planet, Ericsson is well positioned to continue capitalizing on China’s 5G adoption.

Global success of Ericsson (ERIC)

Outside of China, the company is making headway with it’s 5G networks in other countries ranging from Spain to South Korea. In Switzerland, the company has built networks that now have 98% of that country’s population covered by 5G and in the U.K. Ericsson is helping the government implement a 5G strategy designed to help the survival and to thrive in a post-brexit world after it leaves the European Union.

With regards to the United States, Ericsson has agreed to acquire U.S. wireless networking firm Cradlepoint for $1 billion which was Ericsson’s biggest move in more than a decade. This acquisition will give Ericsson access to tools that can connect electronic devices to the Internet of Things (IoT) over 5G networks and Cradlepoint also specializes in routers. Acquisition is expected to complete and close by year’s end.

Is Ericsson (ERIC) a reliable investment?

Absolutely, 5G connectivity is the future of the internet and telecommunications alike. This company is well positioned to capitalize on the rollout of next generation internet and telecommunications, at it’s current price it is highly affordable and shows potential gains over the next couple of years. At $11.80 per share ERIC stock looks like an attractive way for investors to gain exposure the the explosive growth of 5G networks.

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Jay Lorrence
Investor of 12 years and Managing Editor of Money Midnight, a news outlet focused on highly profitable investment ideas and bold underground research.
Articles: 232

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