BCE Inc. (BCE.TO)

Follows both, has owned both in the past but not today. Quickest answer is not to invest in either. 

The reason against BCE is its growth profile. See his Top Picks for BIP.UN, an income name with a much stronger growth profile at a very attractive valuation.

He's not a big fan of momentum trades, but he doesn't keep his head in the sand either on stocks he already owns. Five or six brokers have just upgraded this name, this affects the quants, which affects the fund flows. Met with management, very pleased with tack being taken. Ziply has potential for upside surprise. 

As markets get choppier and froth starts to come out, will probably see money flow back to what's cheap and stable. He tax-lossed it for some clients, others will too, so January will see some buying coming in. This is a long-haul play; frustrating to see it fall from $63, but will probably make it back someday. Yield is 5.35%.

#1 would probably be Telus. BCE is also in there. Names like AC, MFI, PRL, GSY, WFG, and TFII. All of these stocks are cheaper than they ought to be. All things being equal, those names should be higher in January than they are now.

He sold it at the start of the year. It's hard to own the telcos (still holds Telus). The problem is that the expectation over 5G hasn't paid off yet. Also, the capex spend is high. Third, they hold all these media assets. He'd rather see a purer telecom play. Also, the CRTC wants more telco players. It was good that BCE cut their dividend, but should have done it earlier.

The question was on both companies in the telecom sector. BCE did an acquisition in the US and have to prove out those numbers as well as get the leverage down. Telus didn't fall on the same hard times and the dividend is solid. Wireless is starting to turn better and landlines too. Three to four quarters should show unproved financials. Both have turned the corner.

Still sees it as a pretty asset-rich company. Dividend's been reset. Stock has attracted a few upgrades. Bounce from $29 to $34 is already pretty significant. Happy to buy down here where nobody wants it. It's one of those durable companies, need for telecommunications is not going away. 

BCE has already seen two broker upgrades following its investor day. BCE outlined plans to save $1.5B and expand internet service westward, targets $1.5B in AI revenue, and expects revenue growth of 4%. Free cash flow is expected to rise 7% annually through 2028. Opening up competition remains a threat. Overall, investors were pleased with a solid cost-reduction plan but challenges certainly remain.
Unlock Premium - Try 5i Free  

The shares have gone down, and so have his shares. The market is looking past 2025. The wireless market has seen strong competition, and the markets hope this stabilizes in the future, perhaps from less immigration. BCE surprised many with its US acquisition which could add 500,000 customers. Pays a good 5.5% dividend. Isn't much downside from here.

It has seen some challenges and there is more competition in the cell phone space. It will need to reinvent itself in order to continue to grow. It might be a while before we see a turnaround in the company and the sector.

Looking at the downward channel on the chart, no reason to own this stock yet. Seeing nascent bottoming pattern. If it traded in a sideways band going into next year, then he'd be OK with holding it for the dividend until it gets more interesting. 

Great dividend, but you don't want to own it at the expense of losing some capital. Dividend is important, but it can't outweigh capital erosion.

Telcos in NA are a mixed bag right now. He'd be a seller. Other things outside of telecom to do with your money.

Investment community appears to have come around to the Ziply acquisition. His team, too, didn't like the acquisition or the dividend cut. When a stock is wounded or hurt, people will abandon it. A wave of selling from both quant and passive investors that isn't necessarily rational. 

But you don't get a stock moving up this much without some serious institutional interest. Look at the lessons of MFC or ALA. Especially if a name is a bigger weight in the index, once they start to turn they can move a long way. He's not saying it's going back up to $70, but thinks it can get back to $40. Yield of 5% while you wait for that to happen.

Let's look at the 3-year chart. Definitely turning the corner after a 3-year downtrend. Dividend cut helped. Telcos are boring and defensive, lower beta. So they'll weather the upcoming corrective storm of 1-3 months. Doesn't mind nibbling here, but during weakness he'd be putting $$ to work in the more cyclical areas of the market.

The plan is OK. Lots of moving parts. The turnaround from overpaying the dividend is there. Looking forward, dividend's probably safe; can probably start growing it again 3-4 years from now when the fibre play starts to pay off. Fibre is a big move to the future; if it works, it'll be spectacular. 

CRTC decision today to allow competitors to use BCE's fibre footprint will reduce profits, as the access price will be regulated. Hopefully the regulated price will at least cover the costs. Also takes away the oligopoly aspect.