BCE's 8.3% Yield: A Telecom Giant Ready For A Comeback

Sep. 09, 2024 10:15 AM ETBCE Inc. (BCE) Stock, BCE:CA StockBCE, BCE:CA10 Comments
(8min)

Summary

  • BCE offers an 8.3% dividend yield and trades at a discounted Price-to-Cash Flow ratio of 5.9x, making it an attractive value play.
  • Despite recent stock underperformance, BCE shows resilience with growth in mobile subscribers, broadband, and business solutions, driven by strategic investments in fiber and 5G.
  • Cost-saving initiatives, including AI-driven customer service, enhance future cash flow and improve dividend coverage, with $20 million saved in Q2 alone.
  • BCE's strong balance sheet, BBB+ credit rating, and well-laddered debt schedule support its potential for market-level returns, despite regulatory risks.
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Supertruper

U.S. telecoms like AT&T (T) and Verizon (VZ), were bargain buys last year when the market was negative on them amidst higher interest rates, slowing growth, and lead-sheathed cables, to name the primary reasons.

Thankfully, the market has finally

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of BCE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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