The telecommunications sector is composed of companies that provide communication through wired and wireless infrastructure. Some companies are considered both income and growth stocks, due to their strong performance, regulatory protection and good dividends.
The latest generation of cellular mobile communications, 5G, is rolling out, and these companies are preparing to offer high data rate, reduced latency, cost savings and energy saving. Innovations like this contribute to the growth and success of the industry.
Furthermore, telecommunications is considered a defensive stock, as the demand remains steady in times of economic stress and subscription plans give a stable source of revenue.
BCE Inc. (BCE-T)
The holding company for Bell Canada group. They’re almost done their fibre to home that will give them more market share. BCE is the dominant player in this space and they pay a 5.5% dividends. They are well managed and are considered a good defensive stock that will weather a recession.
Buy, rather than sell. They aren't going out of business. Streaming video as well as cell are doing well.
Telus Corp (T-T)
One of the three big Canadian telecom company. They beat subscriber growth and reduced churn in Q4. They’ve increased dividends by 7% and is projected to increase. They have invested in data and are increasing their free cash flow.
Significant equity offering. Will have lots of 5G spending in next 3-4 years. Dividend is safe. Will continue to increase dividend, though dividend growth is slowing as with all telecoms. Yield is 4.5%.
Shaw Communication (B) (SJR.B-T)
A Canadian telecommunications company that has extensive fibre optic network that provides telephone, internet, tv, and mobile services. They are expected to get get a good market share of 5G. They pay a 4% monthly yield.
Shaw missed their last earnings due to increased competition in wireless (Shaw re-entered last year) with lower data packages. She owns few telcos, though they pay an attractive dividend. She prefers BCE who are national and pay a good, rising dividend.
Rogers Communications (B) (RCI.B-T)
A telecom leader that also owns media. They pay a good dividends that is expected to be increased. I has organic growth and some say the media assets are undervalued. They have the largest wireless network in Canada and is considered a defensive growth name.
The balance sheet is fine. They generate a lot of cash flow. There is headline risk because a large part of the their business is wireless and the other two have done a great job of catching up to them in wireless. It is probably a fine time to buy it, however.
Quebecor Inc (B) (QBR.B-T)
A Quebec based communications company that has seen earning growth of over 20%. The growth has been exponential and the company is managed well. Their main area served is limited to Quebec, and are investing in their network.
Telefonica S.A. (TEF-N)
An international telecommunications company based in Spain. Revenues rose in 2018, and they are expecting a 2% organic in revenue. They sold their mobile communications assets in some central American countries back in February.
It's a telecom, which is the worst industry to ever invest in. Telecoms are being swept into the new communication industry which will also include media, cable and internet search. The telecom industry will cease to exist. He's not intersted in telecoms at all. It's crazy. He once paid for long-distance calls; now, they're giving…
One fo the oldest telecommunications company. They have consistently raised dividends for the past 30 years and own 1/3 of the wireless market share in the U.S. They are considered lower risk than their European counterpart.
Issue is direct TV. People are streaming a lot. Plus, took on a lot of debt. 5G will help them. Betting on being able to compete with Disney and Netflix. Nice dividend, not an expensive stock. In this environment, he thinks you're safe with it.
AMERICA MOVIL, S.A.B. DE C.V. (AMX-N)
A Mexican telecommunications corporation that is the fourth largest mobile network operator. Their share price jumped following their acquisition of Nextel’s Brazil operation giving them a strong position in Latin America.
(A Top Pick June 5/07. Down 8%.) Largest cellular company in Mexico. Their capacity utilization of the network is superior to many other global ones. Very Bullish on this stock.
Vodafone Group PLC (VOD-Q)
The United Kingdom’s largest telecom company that offers voice, broadband and data services. Most of their business is in Europe. Due to them being a UK-based company, Brexit talks have negatively affected this stock. They are facing big capital expenditures with 5G but their dividends are considered safe.
Data use is way less than most of the rest of the western world. They are going to move to unlimited data. He is looking at it but has not made a decision on it.
Verizon Communications (VZ-N)
They are the largest telecommunications company in the U.S. and operates internationally. They pay an attractive dividends of 4.2% and their balance sheet looks good. 5G infrastructure will make it a good long term story.
vs. BCE A good US income stock. Own this in a non-registered account to avoid the tax hit. Better to own BCE, because it won't be taxed in a sheltered account.
T-Mobile US (TMUS-Q)
They recently launched their home internet pilot in the US for rural and underserved markets.. They are seeking a merger with Sprint on the grounds that wireless telecommunications and cable are coming together. If this goes through, it could see major upsides.
Still margin pressures on business and some slowing growth. Good cash generation. Balance sheet is in good shape so he wouldn’t have any trouble owning this. Thinks that the best growth is behind some of the telecom companies right now.
Sprint Nextel (S-N)
A U.S. telecommunications holding company. They just announced a merger with T-Mobile, and its consolidation is seen positively by experts. Sprint does not pay a dividend.
Just announced a merger with T-Mobile (TMUS-Q). Telecom has been an industry under pressure for a long time, and we are starting to see smaller players consolidate to cut costs. These are investments you want to hold, only to milk the cash flows remaining in them. The saturation level of smart phones is pretty high.…
China Mobile Hong Kong (CHL-N)
A Chinese state-owned telecommunication company. They have grown their dividends reliably. There is still growth opportunity in China but it’s still a mature business. They have a good balance sheet and is a good long-term investment.
He does not own it, but has looked at it. He is a little concerned about seeing all the information, being that it is a Chinese company. He would look for a different global telco player.