BCE Inc. (BCE.TO)

They had the best subscriber growth last quarter for 5 years. It is finally up a bit. It has been in danger of there not being much growth. They showed maybe that is wrong and we might see a little bit higher earnings.

Sell and move into AT&T (T-N)? Doesn't think this is fully priced. AT&T is a similar company, but trading at a much lower multiple. It has a nice dividend yield. Doesn't see a lot of top line growth coming into these companies. You continue to get a nice dividend, and maybe 2%-4% top line growth. Like BCE, they can probably continue to cut costs, grow their business, and give you a decent rate of return. Expects they will give you 8%-12% rates of return. AT&T's Dividend yield is 5.8%.

(A Top Pick June 12/17. Up 1%.) Typically, every summer, he goes low beta, so he looks for things that maybe don't have tons of upside, but maybe pays a dividend and gives a little bit of return. It might get to $62-$63, and then he would Sell. He tends to trade this through the summer just as a place to own something during the period that he thinks might be more volatile. 5% dividend yield.

Up for the year, but moving in a consolidation pattern, and goes back into 2016. Seasonally, this tends to do well from December into January. He would be positive on this over the next few months.

(A Top Pick Dec 2/16. Up 9%.) He still likes this. Pays an excellent dividend and has a good record of increasing it. Management has shown itself of being quite capable of getting into other areas such as sports, etc.

Still the dominant player in the market, although Telus (T-T) has done very well in the last few years. The big margins seem to be in wireless. He’s a little concerned about the telecom industry as a whole, except for wireless. BCE is still spending a lot of money and facing a lot of competition on the Internet side. On a valuation basis he’d be looking more at Telus.

The 4.9% dividend is important.

The problem with this company is that it is running hard up against its FMV. Every time it has got there, it has quit and set back. Right now, that target is $65, so at the current price you got about 11% to go. After that, it is going to set back.

A good dividend growth story. Well-managed from the perspective that it generates cash to the owners. They are very good to their shareholders. He would attribute the last $5 decline more to the fear of rising interest rates than anything specifically material to the company. Close to a 5% dividend yield is pretty darned good.

He is holding this for the income, which could be under pressure. Doesn’t think you are going to see dramatic increases in the underlying price, but the fundamentals are there. You potentially have a new wireless refresh cycle going on.

The business is under assault, but this company has managed extremely well. They are notorious for controlling costs. They’ve done a good job of acquiring companies where they are generating content to offset the business. The broadcast part of the business may go down, but the content part will be there and there will be distribution. People will want to see it. Thinks you are safe with this, but just doesn’t see a lot of opportunities for capital gains. Dividend yield of 4.9%.

Out of all the Canadian telecoms, he primarily looks at this one. They’ve always had the advantage of having the grandfather position in Canada. Lately, they’ve been changing their model a bit and going more to wireless, with less dependence on their wire line offerings. Also, the provision of Internet services is becoming a bigger and bigger thing. We are seeing a huge movement in the industry to Internet protocol, whether TV, telephone or whatever. This company is going to be one of the primary beneficiaries of that. Feels we may be reaching a plateau with all the telecoms, and he wouldn’t be surprised to see them all pause. Dividend yield of 4.9%.

Out of all the telcos, he likes this one. Their free cash flow yield is around 6%. Has a ton of free cash flow to either buy back or increase dividends. Fibre to the home is almost 2/3 done. The iPhone release is going to be positive for them. They have the lowest wireless attribution to their overall revenue numbers, so they have the most upside. Their biggest problem is that the wire line is decaying. Dividend yield of 4.9%.

The dividend (4.9%) is the main reason to own it. It is fairly valued right now. The growth is not great. They are not as strong in wireless. Their fiber to the home is behind TELUS. You cannot go wrong with any of the top three.

The roll out of FIBE is going to be a huge focus in 2018 for this company. They are taking market share from other players. Good dividend.