BCE Inc. (BCE.TO)

He is constructive on this. Gives good income from the dividend. There will be some negative overhang with regards to the debt, continually borrowing money. A lot of negative overhang with the media side, a smaller component. They have a big wireless division which is growing. The landline division seems to have stopped its bleeding which is positive. He is looking at this cautiously, based on the fact that they are paying out a good deal of their income towards the dividend, as well as borrowing money.

He would value this on a free cash flow basis, looking 1-2 years out. It has come off a little and free cash flow yield has gotten a little better. Management has done a great job. However, top line growth is only at about 1%. They have to spend a lot of money to continue to work on the network to stay competitive. Dividend yield of about 5%.

This is a yield play completely. If looking for share price appreciation, there are better places for that. A great anchor within a portfolio. One of the lowest beta stocks on the TSX. Dividend yield of about 5%.

Not a fan of this. Prefers Telus (T-T) because they are turning around with the Western economy starting to grow again. BCE’s revenues were up 1% in the last year. Assets aren’t growing. While they have good margins, the dividend is only growing roughly at a 4%-5% rate. When you take into account tax and inflation, you are pretty much getting to zero.

Sold his holdings last summer. The top in the last year or so was right when interest rates started to move higher in the US. This company is quite sensitive to interest rates. As interest rates moved higher, the stock has moved down. In the last several months, the stock has held its own and moved sideways. If looking for the 5% yield without tremendous capital growth, then it is a stock you might want to own.

This has a very low beta, which means that no matter what happens in the stock market, this doesn’t get affected much. Also, it gives you a pretty good yield of about 5%. Over the years, the chart shows it has been steadily climbing. In the last several months it is looking a little tired, not negative, but he would wait a month or 2 to see if you can buy it in the low $50s, which would give you much better protection.

Considers this as a core stock in his portfolio. Good yield of about 5%. Pretty regular dividend increases. The largest telecommunications business in Canada. A very safe stock. They have some growth potential with their takeover of Manitoba Tel.

(Market Call Minute.) His favourite telco is Rogers (RCI.B-T), but he would buy any of these today.

This is a good business, but he has a lot of other areas to put capital to work. A very slow growth business. Pays a nice dividend. Trades at around 8.5X EBITDA, which is not exactly cheap. If it ever got down to around the $50 range, it might be an attractive entry point.

He’s been in the process of reviewing his holdings. It is going to grow reasonably well, but his biggest concern is in terms of subscriber growth. It is not doing quite as good as in the past. Has a reasonable dividend and is well managed. He is likely going to be selling this in the very near future. Getting close to being fully valued. His target price is $60.

Just increased their dividend 5%. All the Canadian telcos have seen better wireless subscriber additions recently. The adoption of secondary devices, immigration and demographics is combined to increase the growth rate of these companies. If interest rates increase, there will be a broad macro trade to sell the telecoms and utilities especially, and that’s when he would start looking at this.

This is one he holds in his income platform, but it also suits his growth platform. The chart shows a long upward 3-year trend line, and it has come down to the lower part of the trend line again. He likes the stock from a long-term trend perspective. It also gives a good dividend. (Analysts’ price target is $60.80.)

Took some profits on this some time ago. Good management. They’ve recently come out with quarterly earnings and missed on a couple of spots, but they increased the dividend. You basically hold this for the long-term growth, and the nice fat dividend. 5%+ dividend yield right now.

This has pulled back compared to its peers. Part of it has to do with the media division, where earnings have been choppier than what people expected. When you are looking at telecom stocks, it always seems to be a race or displacement in how many wireline customers are cutting off and how many new subscribers are being signed up, etc. His concern has more to do with the whole industry. Wireless is fine and the future of cell phones is fairly secure. Beyond that it is all going to Internet protocol, and there are so many alternative means by which to get Internet reception, but he is not sure what kind of industry structural changes we will see, particularly over the next 10 years, as well as the impact on these companies.

This has a place in a portfolio, but you have to make sure you are buying it for the right part of your portfolio. If you are looking for some real growth, this company is not where you want to go. You are paying for an established business, high quality, large market share, so it is difficult to get a 10%-12% return. The flipside is that it has a very low beta and has a great dividend.