10. September 2021 | 12:11 CET
Deutsche Telekom, Meta Materials, Apple: 5G - The coming hype
5G will not only make our mobile internet faster, but it is also indispensable for bringing the Internet of Things, industrial automation and autonomous driving to market maturity. Private users can look forward to virtual realities and augmented realities in the future. Augmented realities can present the user with useful information about objects or even activities via glasses. There are already initial applications in this area, but the technology will develop rapidly in the coming years. The market will grow enormously once the 5G network is installed nationwide. In today's analysis, we show which companies could benefit from tomorrow's hype.
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ISIN: DEUTSCHE TELEKOM ADR 1 | US2515661054 , Meta Materials Inc. | US59134N1046 , APPLE INC. | US0378331005
Deutsche Telekom - Expands T-Mobile US shares
One of the primary beneficiaries will be Deutsche Telekom. As a telecommunications service provider, it offers customers access to the internet and the new 5G technology. The mobile network expansion to 5G has been underway for some time and is already available in large parts of Germany. Only in the east are there still a number of white spots on the expansion map. There must be no more white spots in order to help 5G achieve a breakthrough in autonomous driving. More and more data will be collected in the coming years due to higher speeds and greater networking. It is, therefore, a good thing that a cooperation agreement with Google was announced on August 8. Deutsche Telekom will be responsible for the legally compliant use of cloud services to improve its chances of winning tenders from public institutions.
Management was also otherwise active. T-Mobile Netherlands was sold for EUR 3.8 billion, roughly 9 times operating income. Parts of these proceeds are to be used to expand the stake in T-Mobile US. SoftBank, a new strategic partner, has joined the Company and holds 4.5% of Telekom shares. In return, Telekom receives 5.3% of T-Mobile US. With 48.4%, the Group is now on the verge of acquiring a majority stake in the US mobile communications provider. If you look at the earnings that Telekom will retain from this stake, you can talk about a very worthwhile investment. Due to all this news in the last few days, several analysts, such as DZ Bank, Berenberg and Barclays, have set their rating to BUY.
Meta Materials - A material that changes the future
Nasdaq-listed Meta Materials provides sustainable, highly functional, invisible metamaterials whose properties are highly versatile and customizable. These include absorption, emission, sensing, transmission and conduction of light, sound, energy, heat, friction, strength and electrical energy. The product can be thought of as a transparent film with antennas and reflectors on its surface, which is especially useful in building 5G infrastructure. One can, for example, equip windows of large office buildings with metamaterials to provide better network coverage.
Other applications include vehicle electrification. Today, solar panels are too heavy to make it profitable to install them on the roof. The lightness of metamaterials could open up new approaches here. This lightness also makes the technology interesting for the medical technology, energy, aerospace and Internet of Things sectors. The Company relies on a platform covering three core areas: holography, lithography and wireless sensor technology. To quickly develop customized solutions for customers, the Company relies on artificial intelligence, which, according to the Company, reduces the development time from months to a few days.
Meta Materials already has 82 granted patents out of 149 filed and has 8 registered trademarks. Development has been ongoing for more than 10 years, and currently, the Company is expanding its production facility, which is scheduled for completion in the fourth quarter of 2021. The market capitalization of over USD 1 billion reflects the imagination that the Company has. On June 21, the stock was already at USD 21.76 before it almost returned to the starting point of the rally. On August 20, the low was marked at USD 2.86, only to rise from there to USD 6.42 again. Currently, the share can be bought at around USD 5.25.
Apple - When is the next blockbuster coming?
Since competitor Google launched its Google Glass as a first version of augmented reality in 2012, the Apple community has also philosophized about a pair of glasses or a headset for augmented reality. Still, no product has been launched as yet. Apple CEO Cook always showed himself open to this technology, but he always considered the technology not yet far enough. With 5G, this could change; high-speed internet anytime and anywhere provides unlimited access to information whenever needed. A product launch is scheduled for September 14, where the new iPhone 13, the Apple Watch 7 and possibly the Airpods 3 will be presented. New blockbuster products have been looked for in vain at Apple for years. Augmented reality (AR) glasses could be one of these surprises, especially since Apple is probably actually working on it.
For the CEO, such a blockbuster would probably be the crowning achievement of his 10-year term in office. It would also prove his critics wrong, who claim that he is only managing Steve Jobs' legacy. The numbers speak for Cook because, in 10 years, he has managed to increase the profit from USD 0.99 to an expected USD 5.59 a share in 2021. The share price also increased significantly after Jobs' death. Business in software and services is excellent, and even if some developers complain about the Apple Store, business will pretty much continue to be good for the next few years. This is also reflected in the stock, which recently marked a new all-time high. The dividend yield is comparatively low at 0.6%, but the increases in the share price more than make up for that. If a brand-new Apple product comes onto the market, the stock can certainly increase even further, though investors should wait for consolidation at the current level.
All three companies can profit from 5G technology. Telekom as an Internet provider, which can offer customers fast and nationwide internet. Meta Materials provides an opportunity to eliminate dead spots in 5G technology and transport signals. Moreover, this technology is like something out of a science fiction book come true. Apple has been one of the most successful companies for years. If Apple's AR glasses come onto the market, they will undoubtedly be a big seller.