The epic climb can be a surprise, as red heating stocks like Nvidia,, BroadcomAnd PALANTOUT Technologies are all in the technology sector. But communications have certain advantages that could help the sector S&P 500.
THE Vanguard Communication Services Stock market negotiated funds (ETF) (NYSEMKT: Vox) is a simple and low cost way of investing in the sector. With only one spending ratio of 0.09%, or 90 cents for each $ 1,000 invested, the fund is an inexpensive way to reflect the performance of the communications sector.
Here is what pushes the sector to new heights and why the Vanguard Communication Services ETF could be useful now.
Image source: Getty Images.
Almost half of the communications sector is Meta-platforms(Nasdaq: Meta) And Alphabet(Nasdaq: Goog)(Nasdaq: Googl). If it is common for a handful of companies to be very weighted, no other sector is as concentrated in two companies as communications.
ETF of the Vanguard sector
Top two participations
Allowance in the two top two titles
Vanguard Communications ETF
Meta platforms and alphabet
48.5%
Discretionary ETF Vanguard Consumers
Amazon And Tesla
40.8%
Vanguard Energy Etf
Exxonmobil And Chevron
34.4%
Vanguard Information Technology FNB
Apple and nvidia
30.7%
Vanguard Consumer Staples Etf
Costco on who And Walmart
27.2%
Vanguard Materials FNB
Linde And Sherwin-Williams
21.9%
Vanguard Health Care FNB
Eli Lilly And United Group
18.6%
Vanguard Utilities ETF
Nexttery energy And Constellation energy
18.4%
Vanguard Financials ETF
JPMorgan Chase And Berkshire Hathaway
16.5%
Vanguard Real Estate Etf
Prologis And American tour
11.6%
Vanguard Industrials ETF
Ge aerospace And Caterpillar
7.2%
Data source: Vanguard group.
Although the ETF Vanguard Communication Services has 117 holdings, it is not so diverse when you look at the weights of the best holders. In addition, 11.8% of the fund is in media giants Netflix,, Walt DisneyAnd Comcast. 10.4% of the fund is in telecommunications companies At & t,, Verizon CommunicationsAnd Mobile.
Add everything and the essentially large bet fund to a small number of companies.
The size of the meta-platform and the alphabet shows how precious social media has become compared to traditional communication companies. Aside from the assessments in stock, Meta and Alphabet undoubtedly have two of the best commercial models on the planet.
Google Services, which includes YouTube advertisements, Google Search, Google Network, Google subscriptions, platforms and devices, won $ 304.93 billion in 2024 income and 121.27 billion dollars of operating profit for a margin of operation of 39.8%.
This does not even take into account Google Cloud, which is the fastest alphabet growth segment by income. However, the segment is currently at low margin because alphabet spills investment funds in the strengthening capacity to follow Amazon’s web services and Microsoft Azure.
In comparison, the family of META platform applications (Instagram, Facebook, Whatsapp, etc.) won $ 164.5 billion in 2024 and $ 87.1 billion in operating profit – for a margin of 53%exploitation.
Alphabet and Meta have such high margins due to the nature of the light of capital of their advertising commercial models. Netflix, Disney and Comcast spend billions each year producing content. Telecommunications companies must invest and maintain physical infrastructure and customer service programs.
Alphabet and Meta have no high operating costs, which allows them to convert more sales to profit. The main expenses are the workforce and the maintenance of their platforms. Content creators on YouTube and Instagram do the work for them. It is a completely different business model than trying to produce content in the Hope public receives it well.
The high margins allow the two companies to support massive research and development programs, to buy actions and (from last year) pay dividends. In 2025, Meta invests $ 65 billion in capital expenses (CAPEX) – mainly on artificial intelligence (AI) – to stimulate commitment to its platforms and allow advertisers to carry out more specific campaigns. Its division of reality laboratories (very little profitable) invests in virtual and increased software and materials. But, once again, Meta can afford these investments because advertising activity is so strong.
Alphabet has integrated AI features into Google research and is on the level of cloud infrastructure. He forecasts a failure of $ 75 billion in 2025 CAPEX. Despite a myriad of advantages, alphabet has a price / benefit ratio (P / E) ultimately 20.4, against 28.4 for Meta platforms. However, Meta’s advertising activities increase more quickly and are undoubtedly better than those of the alphabet, so the premium evaluation is logical.
However, the two actions have p / e to advance lower than many other technical names of mega-captain. And this counts in the massive Meta gain of 245% in the past three years.
Investing in the communications sector is a big bet on the alphabet and meta-platforms, which is why most of this discussion was focused on these two actions. Despite the outperformance of the sector in 2024, and so far in 2025, the two actions have reasonable valuations and strong growth prospects, which suggests that they could still be useful to buy now.
As long as the two actions continue to carry out strong gains, the ETF of Vanguard Communication Services can continue to surpass the S&P 500. The ETF is a good bet if you are interested in the alphabet and the meta and you want a certain diversification beyond these two actions. The ETF has a yield of 1% and a 23 p / E report. It is much cheaper than other ETF focused on growth, such as the Vanguard Information Technology ETF, which has a yield of 38.5 p / e and only 0.6%.
However, if you are looking for a variety of mega-space growth stocks without the restrictions that support investment in actions in a given sector, it may be worth looking at the Vanguard Growth ETF or the Vanguard Mega Cap Growth Growth Etf.
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John Mackey, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the board of directors of Motley Fool’s. Randi Zuckerberg, former Director of Development of the Facebook and Sister of the CEO of Meta Platforms, Mark Zuckerberg, is a member of the board of directors of Motley Fool’s. Suzanne Frey, director of Alphabet, is a member of the board of directors of Motley Fool’s. Jpmorgan Chase is an advertising partner of Motley Fool Money. Daniel Foelber To posts in Caterpillar and Walt Disney and the following options: Short March 2025 115 $ Calls on Walt Disney. The Motley Fool has positions and recommends Alphabet, Amazon, American Tower, Apple, Berkshire Hathaway, Chevron, Costco Wholesale, Jpmorgan Chase, Linde, Meta Platforms, Microsoft, Netflix, Nextera Energy, Nvidia, Oracle, Palanter Technologies, Prologis, , Tesla, Vanguard Index Funds-Vanguard Growth ETF, Vanguard Real Estate ETF, Walmart and Walt Disney. The Motley Fool recommends to Broadcom, Comcast, Constellation Energy, Ge Aerospace, Sherwin-Williams, T-Mobile US, Unitedhealth Group and Verizon Communications and recommends the following options: Long January 2026 Calls $ 180 on American Tower, Long January 2026 395 $ $ 395 Calls on Microsoft, Long January 2026 90 $ calls prologis, short January 2026 $ 185 calls the American tower and short January 2026 405 $ calls Microsoft. The Word’s madman has a Disclosure policy.
