Gone are the days when telecom stocks were the quiet corner of Wall Street with steady bills, steady dividends and few surprises. Over the past two weeks, they have become the market’s most reliable losers.
S. Telecommunications ETF (BATS:IYZ) has underperformed the SPDR S&P 500 ETF Trust (NYSE:SPY) for 12 straight sessions through Thursday.
That is the longest such run since the fund launched in May 2000. From Oct.
7 to Oct. 9%.
9%. The company standing over the streak is Space Exploration Technologies Corp.
(NASDAQ:SPCX), better known as SpaceX. S.
Telecommunications ETF relative performance against the SPDR S&P 500 ETF Trust and consecutive underperformance count. Source: TradingView SpaceX: America’s New Carrier?
58 billion. S.
wireless business. SpaceX “will be building out our terrestrial networks” wherever Starlink is allowed to operate, he said.
The company also said S-band airwaves should carry most Starlink Mobile traffic, while newly acquired 800 MHz spectrum will bring the signal inside buildings. Starlink Mobile ended the quarter with 22 million monthly users, up 37% from the prior quarter.
Then, on Thursday evening, Bloomberg reported that SpaceX is in talks with tower owners, including Crown Castle Inc. S.
cell sites. S.
last year. Crown Castle CEO Chris Hillabrant was asked about leases with SpaceX on the tower company’s earnings call this week.
“You can assume that we’re talking to all parties,” he said. Read Also: SpaceX Jumps 10%, Nasdaq 100 Rises as AI Trade Returns: Stock Market Today The Day The Carriers Broke The streak turned on Oct.
8. After the close, SpaceX agreed to buy Grain Management’s nationwide 800 MHz spectrum portfolio, pending approval from the Federal Communications Commission.
” The next day, AT&T Inc. 8%, Verizon Communications Inc.
1% and T-Mobile US Inc. 3%.
AT&T traded about 150 million shares that session, nearly four times its average over the prior four days. The carriers clawed back part of those losses.
8%. The relief did not last.
20, according to Benzinga Pro data. Tower owners, by contrast, are being priced as SpaceX’s landlords.
3% premarket, while American Tower Corp. 3%.
Why IYZ Fell Harder Than The Carriers IYZ is half a telecom fund and half a networking-hardware fund. Cisco Systems Inc.
(NASDAQ:CSCO) and Arista Networks Inc. (NYSE:ANET) made up about a third of its assets at the end of June, according to the fund’s latest SEC holdings filing.
Since Oct. 1%.
7%. Thursday showed the split clearly.
5% as AI networking stocks sold off with the broader tech sector. 2%, Ciena Corp.
7% and Lumentum Holdings Inc. 5%.
In addition, AST SpaceMobile Inc. (NASDAQ:ASTS), an IYZ holding that is building its own satellite-to-phone network, has lost 37% over the past month.
As a result, the fund was hit from two sides at once: a new competitor for its carriers and an unwind in AI networking hardware. NameOct.
9 moveSince Oct. S.
3%AT&T Inc. 4%Verizon Communications Inc.
8%T-Mobile US Inc. 8%Cisco Systems Inc.
1%FlatArista Networks Inc. m.
ET on Oct. 23.
