By historical standards, the various telecoms are pretty boring stocks to own.
Steady demand, high fixed costs and cash flow generation have long been hallmarks of the sector. No wonder they call them “widow and orphan” stocks. And with that, many top telecoms are simply viewed as dividend machines. However, every once in a while, the sector sees a turn in technology that causes immense growth.
The latest example of this is the impending 5G build-out.
Faster wireless networks will bring the next stage upward for the normally sleepy telecom sector. And for investors, the build-out, roll out and adoption from consumers will represent another sizable jump to the sector’s cash flows. And where there’s cash flows, there are usually plenty of dividends to follow.
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