BCE Inc. (BCE.TO)

Likes its traditional business -- stable, defensive, high barriers to entry. Good job diversifying away from traditional telco business, making deals on data centres (but not taking on technology risk, and valuations are not extreme). With geopolitical conflicts, we want Canadian data stored in Canada. 

Safest way, by far, to play AI data centre growth. Expecting $2B in data centre revenue by 2028. Yield is 5.73%.

After the cut, dividend yield is ~5%. That's sustainable. Evolving into an AI data centre infrastructure play, and he likes that it's putting capital to work there. It's a structural theme for many years to come. But core business is under pressure as telcos compete on price and for market share.

If you're here for the dividend, you're safe. If you're here for stock appreciation, you're likely to be disappointed.

BCE is a warning for Telus: cutting the dividend, then the stock struggles. Long term, these wired and wireless network will have value for Canadians. Also, telcos are leveraging their tech footprint in the data centre business, which could become a growth lever. Telcos--which faciliatate social media and communicating--will continue to hold value. He likes BCE at current levels.

Telus is paying out all of its FCF, and maybe then some, in dividends. You have to be OK with that. And who knows whether the new CEO will cut that dividend?

Both have come down a lot. You could make the case to buy these beaten-down companies to get the yield, and that's not a terrible idea. For the very long term, at these valuations, probably not much downside. Question is: How much upside? If inflation does come down and central banks start lowering rates again, companies like these may get a bid.

Prefers, and owns, RCI.B.

In the midst of Canada's technical recession, you have to think about what kind of investor you are. A basket of telcos can be used as a bond proxy, as it'll provide income in your portfolio. Income can then be used to protect you defensively on the downside, or to redeploy into growthier names. It gives your portfolio some ballast.

It's an income story, not a growth story. Doesn't see much problem if you hold it longer term. If Telus cut its dividend, he'd probably buy. 

Ask yourself this:  If he gave you the same amount of $$ you already have invested, would you buy the stock again? The world has changed. Premium pricing has come to an end. Valuation compression might be over. 

Owns it, but it's on a very short leash (ultimately to be recycled into something else). Yield is 5%.

Telcos have been under pressure for quite a while, extremely volatile. She owns none of them. Until she sees a sector turnaround, she's staying clear.

This name is still one of the Big 3. Still using capital to push into the US via Ziply. Good move to sell sports stake to Rogers. Rebuilding balance sheet, pivoting to fibre as the growth story. Turnaround still has some work to do, but it's taking the right steps.

Their dividend cut surprised the market. They did it to invest in the US. Shareholders depend on the dividend, so they sold. 

Cut dividend by 56%. Peak phone ownership is a headwind. Interesting story, not largely talked about, is its AI Fabric data centres. Like a sovereign Canadian AI play -- could create tailwinds. Other areas for better income.

Pricing pressure in the sector. Doesn't see appetite for another big telecom merger anytime soon. 

In the sector, he'd probably look at BCE or RCI.B.

His firm really doesn't buy turnaround situations. He wants things that are good and getting better, with positive catalysts and technically sound. As the stock comes off the bottom, you have all these people just itching to sell and get their money back.

Won't be a market leader anytime soon. Better places for your $$. If you can take a tax loss, he'd step aside.