RE:RE:T.D.
Same with RBC...
March 17, 2024
BCE Inc.
Company description
BCE is Canada’s largest telecom services company and one of the country’s
largest corporations. BCE provides local, long distance, wireless, satellite,
television, and Internet services across Canada. BCE has a 100% stake in
Bell Media, Canada’s largest integrated media company.
Investment summary
We believe BCE is well equipped to navigate a slower revenue
environment leaning on a scale advantage, continued FTTH investment
and Internet market share gains, the realization of cost efficiencies, and an
extensive array of tactical initiatives across wireless, wireline and media.
We believe underlying FCF in the current growth environment should
continue to support low-single digit dividend growth underpinned by
ongoing structural cost efficiencies and what is likely a permanent step-
down in capex following three years of elevated FTTH investment. While
we see more attractive growth and valuation set-ups elsewhere in the
sector at the moment, we continue to view BCE as a higher-quality core
holding that is well positioned to benefit from network convergence and
long-term growth in 5G B2B (IoT, MEC, private network, cloud, security).
Potential catalysts for the stock
• Increased visibility on wireless competition
• Acceleration in wireline data growth driven by Internet penetration and
improved business market conditions
• Greater-than-expected cost efficiencies
• A greater-than-expected revenue contri