Is the telecommunication sector defensive?
It seems as though the telecom sector is more like a consumer discretionary sector. What are the major differences in the way a consumer discretionary stock obtains revenue compared to a telecom sector obtaining revenue?
Yes, it can be considered defensive. Just remember that high dividend companies (like telecoms) can be hurt by rising interest rates.
If investors are using dividends as an interest income replacement, when rates rise, they may choose the safer bond investments.
That could hurt the dividend stocks. Know what your risks are.
Hope that helps!
The telecommunication sector is defensive. Their stocks tend to outperform in recessions. Certainly, there has been more cyclical aspects to the sectors. They have to spend more money to keep their networks updated and there is more competition. But the use of their network is growing secularly and does not decline significantly in market slowdowns.