5 Best Communication Services Stocks To Invest In

In this article, we discuss 5 best communication services stocks to invest in. If you want to see more stocks in this selection, check out 13 Best Communication Services Stocks To Invest In. 

5. Verizon Communications Inc. (NYSE:VZ)

Number of Hedge Fund Holders: 62

Verizon Communications Inc. (NYSE:VZ) is a New York-based company that offers communications, technology, information, and entertainment products and services to consumers, businesses, and public enterprises worldwide. Verizon Communications Inc. (NYSE:VZ) is one of the best communication stocks to invest in. On December 1, the company declared a quarterly dividend of $0.6525 per share, in line with previous. The dividend is distributable on February 1, to shareholders of record on January 10. 

On December 19, MoffettNathanson analyst Craig Moffett upgraded Verizon Communications Inc. (NYSE:VZ) to Market Perform from Underperform with an unchanged price target of $41. After “an unprecedented stretch of underperformance” for Verizon, the analyst believes his prior Underperform recommendation for “has likely run its course”.

According to Insider Monkey’s Q3 data, Verizon Communications Inc. (NYSE:VZ) was part of 62 hedge fund portfolios, compared to 58 funds in the last quarter. Ken Griffin’s Citadel Investment Group is the biggest position holder in the company, with 5.2 million shares worth $200.4 million. 

Here is what Mawer Investment Management has to say about Verizon Communications Inc. (NYSE:VZ) in its Q3 2022 investor letter:

“There are a few other segments of our portfolios that displayed weakness in the quarter. Cable and telecommunication companies have been an area that has lagged the broader market as their worlds are increasingly colliding. Companies such as Verizon (NYSE:VZ) have been impacted as wireless operators are spending heavily to attract internet subscribers with fixed wired access and the cable companies are trying to build wireless businesses.”

4. Cisco Systems, Inc. (NASDAQ:CSCO)

Number of Hedge Fund Holders: 68

Cisco Systems, Inc. (NASDAQ:CSCO) is a California-based company that designs, manufactures, and commercializes Internet Protocol-based networking products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. On December 8, Cisco Systems, Inc. (NASDAQ:CSCO) declared a $0.38 per share quarterly dividend, in line with previous. The dividend is payable on January 25, to shareholders of record on January 5. It is one of the premier communication stocks to invest in. 

On December 13, investment advisory Morgan Stanley raised the price target on Cisco Systems, Inc. (NASDAQ:CSCO) to $52 from $48 and kept an Equal Weight rating on the shares. Analyst Meta Marshall issued the ratings update. 

According to Insider Monkey’s data, 68 hedge funds were long Cisco Systems, Inc. (NASDAQ:CSCO) at the end of Q3 2022, compared to 63 funds in the prior quarter. John Overdeck and David Siegel’s Two Sigma Advisors is the largest stakeholder of the company, with 9.70 million shares worth $388 million. 

In its Q1 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Cisco Systems, Inc. (NASDAQ:CSCO) was one of them. Here is what the fund said:

“Cisco Systems (NASDAQ:CSCO) traded lower as investors weighed how supply chain concerns would impact sales growth. The company has been upgrading its switching and routing offerings, which should lead to strong demand as on-site locations upgrade infrastructure.”

3. Charter Communications, Inc. (NASDAQ:CHTR)

Number of Hedge Fund Holders: 68

Charter Communications, Inc. (NASDAQ:CHTR) was founded in 1993 and is headquartered in Stamford, Connecticut. It operates as a broadband connectivity and cable operator company, catering to residential and commercial customers in the United States. It is one of the top communication stocks to consider. 

On January 5, Truist analyst Greg Miller upgraded both Charter Communications, Inc. (NASDAQ:CHTR) to Buy from Hold with a price target of $550, up from $380. The analyst believes the risks facing the company from fixed wireless and fiber are now “well understood,” leaving the shares oversold. 

According to Insider Monkey’s Q3 data, Charter Communications, Inc. (NASDAQ:CHTR) was part of 68 hedge fund portfolios at the end of Q3 2022, and Harris Associates is the biggest stakeholder of the company, with 4.3 million shares worth $1.3 billion. 

Here is what Weitz Partners Value Fund has to say about Charter Communications, Inc. (NASDAQ:CHTR) in its Q3 2022 investor letter:

“Liberty Broadband’s primary asset is a 26% stake in Charter Communications (NASDAQ:CHTR). Charter is not sitting still; the company is adapting via footprint expansion into underserved areas, price-advantaged mobile line growth, and so on. Charter’s hefty free cash flows are valuable in the hands of proven, astute capital allocators. Time will tell, but to paraphrase country music artist Merle Haggard, we do not yet think cable’s good times are really over for good.”

2. Comcast Corporation (NASDAQ:CMCSA)

Number of Hedge Fund Holders: 73

Comcast Corporation (NASDAQ:CMCSA) is an American media and technology company that operates through Cable Communications, Media, Studios, Theme Parks, and Sky segments. It is one of the best communication stocks to consider. On November 17, Comcast Corporation (NASDAQ:CMCSA) announced a $3 million investment to expand its broadband network in Charlottesville, Chesterfield, Fredericksburg, Reston, Sterling, and Woodbridge in the State of Virginia. Comcast’s network can deliver speeds up to 1.2 Gbps for small and mid-sized businesses and up to 100 Gbps for larger corporations.

On January 5, Truist analyst Greg Miller upgraded Comcast Corporation (NASDAQ:CMCSA) to Buy from Hold with a price target of $50, up from $34. While investors in 2022 recognized that broadband flow share trends fundamentally changed, efforts to “stem the erosion are proving successful and should once again cause the stocks to trade at traditional premiums to telecom stocks,” the analyst wrote in a research note.

According to Insider Monkey’s data, Comcast Corporation (NASDAQ:CMCSA) was part of 73 hedge fund portfolios at the end of September 2022, compared to 75 in the prior quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the leading position holder in the company, with 31.6 million shares worth over $928 million. 

ClearBridge Investments made the following comment about Comcast Corporation (NASDAQ:CMCSA) in its Q3 2022 investor letter:

“The Strategy was not completely insulated to macro headwinds and some companies saw tough comparisons after strong pull forwards in demand during the COVID-19 pandemic. Media companies including Comcast Corporation (NASDAQ:CMCSA) were hurt by both factors in the quarter.

After extremely strong broadband growth during the early days of the pandemic, Comcast is now experiencing slowing to negative growth in its broadband business due to new competition and less consumer moving activity along with headwinds on the programming side, where advertising budgets have been more stressed.”

1. T-Mobile US, Inc. (NASDAQ:TMUS)

Number of Hedge Fund Holders: 100

T-Mobile US, Inc. (NASDAQ:TMUS) was founded in 1994 and is headquartered in Bellevue, Washington. The company provides mobile communications services in the United States, Puerto Rico, and the United States Virgin Islands. On January 4, T-Mobile US, Inc. (NASDAQ:TMUS) announced that it added 6.4 million total postpaid customers in 2022, which topped expectations, and also added 2 million new high speed Internet customers during the year. It is one of the top communication stocks to monitor. 

On January 5, T-Mobile US, Inc. (NASDAQ:TMUS) preannounced robust customer results for Q4, with the improved postpaid phone performance supported by very low churn despite some gross ad weakness, JPMorgan analyst Philip Cusick wrote in a research note. T-Mobile US, Inc. (NASDAQ:TMUS) is the analyst’s best long-term idea across his coverage and favorite communications services stock. He reiterated an Overweight rating on the shares with a $200 price target.

According to Insider Monkey’s data, 100 hedge funds were bullish on T-Mobile US, Inc. (NASDAQ:TMUS) at the end of Q3 2022, compared to 96 funds in the preceding quarter. Warren Buffett’s Berkshire Hathaway is the leading stakeholder of the company, with 5.2 million shares worth $703.3 million. 

In its Q4 2021 investor letter, ClearBridge Investments shared its stance on T-Mobile US, Inc. (NASDAQ:TMUS):

“As mentioned, the communication services sector has come under some pressure, and irrational pricing competition has negatively impacted wireless industry growth and profitability of late, weighing on T-Mobile. Faced with these headwinds, and with pressure from other wireless carriers and cable companies that could cause the company to cede share in subscriber growth in 2022, we exited our position in the fourth quarter.”

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