Vanguard Communication Services ETF outperforms in 2025, heavily relying on Meta Platforms and Alphabet.

From Nasdaq: 2025-02-23 09:47:00

In 2025, the communications sector continues to outperform, with top stocks like Nvidia and Palantir in technology. The Vanguard Communication Services ETF (NYSEMKT: VOX) offers a low-cost way to invest in the sector, heavily weighted in Meta Platforms and Alphabet, making up 48.5% of the ETF. The concentration on these two giants drives the sector’s growth.

Meta Platforms and Alphabet’s high margins and strong business models set them apart from traditional communications companies. Alphabet’s Google Services generated $304.93 billion in revenue, while Meta’s family of apps earned $164.5 billion in 2024. Both companies have room for growth, with Meta investing $65 billion in AI and Alphabet forecasting $75 billion in capex.

Investing in the communications sector heavily relies on Alphabet and Meta Platforms. The Vanguard Communication Services ETF offers diversification beyond these two stocks, with a 1% yield and 23 P/E ratio. Both Alphabet and Meta have reasonable valuations and strong growth prospects, making them potential worthwhile investments in 2025.

Considerations before investing in Vanguard World Fund – Vanguard Communication Services ETF include the Motley Fool’s top stock picks, which exclude this ETF. The service has a history of providing high returns compared to the S&P 500 since 2002. With a focus on growth stocks, the ETF’s performance may be impacted by market trends and the success of its top holdings, including Meta Platforms and Alphabet.



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