RE:RE:RE:RE:RE:RE:RE:RE:Nope - Not a Dividend Cut
Quintessential1 wrote: I like your synopsis and would be curious to know what price your limit order has been placed at?
Do you see the share price moving back down or has it reversed and entered a new uptrend?
GLTY and all
JayBanks wrote: For everyone talking about the dividend:
The most important dividend date of the year happens first week in February, as that is the announcement date for what is usually yearly increases. That's where you will get the indications of what to expect going forward for payouts.
I'm in the camp that it will continue to be raised about 5ish% so, expecting between $1.01-1.015 per quarter.
They bought the largest spectrum share, they are reducing capital expenditures related to lower revenue expansions, increased immigration means more customers even if they don't increase thier share of the competitive pie, buying back shares, adding tuck acquisitions and partnerships, divesting low revenue assets, and with interest rates set to reduce they are going to have less interest expenses, that is a bunch of positives as fare as the overall balance sheet outlook which should be supportive of continued payout growth trend, at this point.
That said, I feel pure revenue generating growth going forward might be a lingering issue, as the government is trying to reduce costs on access which would reduce revenue per user, the media division has many headwinds that can cause struggles and also the potential of a new player coming can reduce market share.
I have put in a limit order to add a few shares, I'm just taking advantage of the beat up share price to set up my portfolio better for utilizing call option potential and keep it somewhat balanced for me. I don't feel that this is a strong buy on the buisness itself. I'm interested in the recovery aspect as we should likely be valued mid $60s, with periods of overbuying that hit $70s, I've somewhat changed my perspective from an investor in BCE (for about 10 years) to a likely trader, as I don't know that this is the same company going forward that will grow 8-12% a year like it did from 2009-2017.
50 shares at $51.50 in my taxable account to get me to 200 shares is my current order. I hold anouther 103 in my TFSA. It was an overweight position years ago when I initially jumped in (my 3rd highest position), but I found more interesting places to put new money in over the years and it wasn't compelling enough to add new money to either, now I'd say it's fallen to an underweight position (10th highest) and I don't have a real desire to bring it in line with others, but I would like to be able sell 2 contracts for calls rather than a single to help make use of the position. And if it gets called away, oh well, hopefully I got a few rounds of premiums to augment the dividends.
I don't know that it will drop back into my limit price. I do believe the share price will gradually rise but I am reluctant to call it an 'uptrend' more a 'revovery story'. When the upcoming dividend announcement is made, it will likely jump on the news (which I will want to have my shares before), and should continue a few pennies upwards as we get closer to interest rate cuts. To be a real uptrend, I would say that the underlying businesses need to show growth and upside, at which point it should full recover sharply to a normal range and then maybe carry on forwards with regular ebbs and flows (similar to a 10 year chart of CNR), but again I don't feel the buisness outlook is that favourable. What is the spark that is going to push for higher revenues that isn't mitigated by inflation.
If you want something wild to discuss here, ponder this... what would happen if they spun off the underlying businesses under the parent Brookfield-like... Bell Communications and Bell Media operated as different entities. I'm sure the Communications side would rise gradually as we have been accustomed to acting like the utility it is reliant on mostly new connections mostly due to population and usage growth. But, the Media side unhinged could make bigger bolder moves with investment and leverage and would have the chance to fail or flourish. Currently I think, most of the leverage and expense is held on/for the Communications side which limits what can be done elsewhere.