Randy Hales, President and Chief Executive Officer, said, “Our business performed extremely well across the board during the third quarter. With two of the strongest brands in the mobile lifestyle category – InvisibleShield and mophie – combined with an enhanced operating structure, we’ve created a powerful platform that is generating record revenue and Adjusted EBITDA…”
T-Mobile US Inc. stock has formed a massive positive divergence on large players volume. Analysts with Societe Generale gave a Buy rating on T-Mobile stock and set a $71 price target (15.5% upside from the previous close of $61.47).
Cradlepoint published an awesome research report about what is 5G implementation schedules for the major carriers and what technology they will be using.
I will try to summarize the important parts of Cradlepoint’s research report and link to the full report in PDF format below.
What is 5G In 2017?
5G is not like 4G yet and won’t be for a few years.
The 5G trials being touted by network operators are for fixed wireless access only. Thus, 5G initially is only useful for point-to-point, line-of-sight transmission as it can not penetrate buildings and walls yet.
Verizon stopped digging trenches 10 years ago for its Verizon FiOS (Fiber Optic Service), and last year Google discontinued its Google Fiber program. Digging trenches and maintaining wired lines has become cost-prohibitive.
The first use of 5G will be for fixed wireless access. Providers will use millimeter wave, the portion of 5G that works well to pass large amounts of data from one fixed point to another. They also will use 5G as an alternative to fiber connectivity to homes and businesses.
What is 5G Technology?
In order to achieve amazing 5G speeds in the future, the industry will get a lot more complex and use different telecommunications technologies from the past.
5G will encompass many wireless technologies, including 5G New Radio, Gigabit LTE for super-fast speeds; LTE IoT for low power, long battery life, and long-range coverage; Digital TV, C-V2X, or vehicle to anything; and ultra-low latency.
5G will build on the architecture of voice (2G); voice, video, and data (3G); and massive mobile data (4G)—and add massive bandwidth and density, as well as ultra-low latency. 5G also will integrate aspects of WiFi and long-range/low-power networks.
What is 5G Fixed Wireless Access?
The first form of 5G will be implemented with fixed wireless access. Fixed wireless access is having an antenna on the street or nearby building and then beaming the 5G transmission to a nearby antenna on a business or home.
In other words, the first deployments of 5G are meant to replace fiber, cable, and DSL for last-mile connectivity into homes and businesses.
What is 5G Rollout Schedule?
True wireless 5G is still years away but the initial deployments of 5G will arrive within the next year.
By 2019 millimeter wave will be combined with sub-6 GHz spectrum—including all current LTE and WiFi for failover/failback with ubiquitous coverage indoors and out. New sub-6 GHz spectrum will be available as well, including unlicensed 3.5 GHz CBRS and 5 GHz LAA, allowing for increased bandwidth on free spectrum. This important building block will enable network operators to make “true” 5G available.
The stock of Globalstar is uptrending in a momentum squeeze after heated bidding for wireless spectrum occurred in Straight Path. Traders and investors are betting that a similar bidding war could take place over GSAT.
We had a bullish Pocket Pivot on Friday, June 23, 2017 and the volume shows that large players are accumulating the stock. The Twiggs Money Flow is also moving higher and looks to break above the zero line next week.
Globalstar looks like a good setup for a long entry. Prices have been consolidating lately and the volatility has been reduced which has formed a momentum squeeze.
There is very little resistance above the current price. There is a support zone below the current price at 2.13, a stop order could be placed below this zone.
The fundamentals on GSAT are not good and so this would be a short-term momentum play only on a wireless spectrum bidding war from FANG companies.
February 5, 2017: Sell xG Technology for a +58% win. Congratulations if you were able to make money on the trade. The company has filed to offer common stock and warrants for an indeterminate amount through Aegis Capital. When ever you see that type of dilutive filing, it’s best to sell as quickly as possible and book those profits.
December 29, 2016: xG Technology to close Vislink acquisition on January 9, 2017. xG Technology announced today that the closing on the previously-announced acquisition of Vislink Communication Systems (“Vislink”) has been scheduled for January 9, 2017. This will coincide with Vislink’s general meeting and shareholder vote on the acquisition agreement that will take place the same day.
xG Technology originally announced the Vislink acquisition on Oct. 20, 2016, and announced the signing of the final definitive business purchase agreement on Dec. 19, 2016.
December 26, 2016: Quarterly revenue growth for xG Technology has exploded +850% year over year.
December 19, 2016: xG Technology announced that it had signed the final definitive business purchase agreement to acquire Vislink Communication Systems from Vislink, Plc. All substantive terms of the acquisition, which was originally announced on Oct. 20, 2016, have been agreed upon by the respective parties and due diligence has been completed. The agreement is subject to Vislink shareholder approval, and funding of the acquisition is expected to be finalized after that.
The CEO said, “The Vislink acquisition represents a transformational step for xG Technology, and we believe it will help xG realize overall revenues of at least $60 million in 2017. There are impressive sales, technology, and manufacturing synergies between Vislink and IMT which will be realized as we integrate the operations in 2017.”
December 8, 2016: xG Technology announced it had received a $450,000 order from a state investigation bureau located in the South Atlantic region (“the Bureau”) for the IMT Airborne Video Downlink System (“AVDS”). The system consists of an integrated suite of downlink transmitters, receivers, and antennas that will be used to capture and transmit real-time, reliable high-definition video from fixed-wing aircraft for display at command centers, mobile receivers and on video management systems.
The Bureau recently acquired a new fixed-wing aircraft and determined that the IMT AVDS would be perfect to enhance its capabilities for carrying out law enforcement investigations and surveillance missions. The AVDS is known for its ability to deliver clear and stable video from extended ranges and aerial platforms.
xG Technology has created a broad portfolio of intellectual property that makes wireless networks more intelligent, accessible, affordable and reliable.
Verizon wants to maintain its lead on coming 5G technology by purchasing XO Communications’ fiber optic network. Fortune writes…
The carrier has said it will likely go national with cable TV and Internet service offered via 5G, which can carry signals at speeds of two to five gigabits per second—20 to 50 times faster that common 4G networks.
The problem though is that Verizon will still have to build out 5G towers because 5G wireless cannot travel as far as 4G wireless. A carrier can have the fastest fiber optic network in the country, but until they build 5G towers that connect wireless customers to that fiber optic network, it’s useless for mobile smartphone users.
So why did Verizon just spend $1.8 billion of investors money on XO Communications? Verizon will use XO Communications’ nearly 26,000 miles of fiber optic cables to expand its consumer and business wired internet service offering. Verizon wants to grab market share from companies like Comcast in the home and business ISP market.
Verizon will no doubt have a significant role in the IoT industry as billions of more devices go online over the coming decade.
Verizon Stock Chart
The Twiggs Money Flow is rising nicely, but it is still below the 0 line. Nevertheless, I see the positive divergence on the money flow as a sign the bottom in Verizon stock is near. Verizon stock has sold off over the last five months giving an excellent valuation of P/E 14, and forward P/E of 12. The annual dividend yield on Verizon is a sweet 4.8%.
I see Verizon as a long-term hold on the growing IoT industry.
Disclosure: I do not hold any position in Verizon stock at the time of publishing this article.