Daily Stock Analysis: BCE Inc. (BCE)

BCE Inc, known by the ticker symbol BCE, is a large cap telecom services firm in the Communication Services business sector. This is my first report on BCE for my Viital stock portfolio which was selected as the forty-fifth pick for my Vista portfolio.

BCE is both a wireless and Internet service provider, offering wireless, broadband, television, and landline phone services in Canada. It is one of the big three national wireless carriers, with its roughly 10 million customers constituting about 30% of the market. 

gray metal tower with accessories

Image Source: Unsplash

It is also the ILEC (incumbent local exchange carrier--the legacy telephone provider) throughout much of the eastern half of Canada, including in the most populous Canadian provinces--Ontario and Quebec. 

Additionally, BCE has a media segment, which holds television, radio, and digital media assets. BCE licenses the Canadian rights to movie channels including HBO, Showtime, and Starz. 

In 2020, the wireline segment accounted for 55% of total EBITDA, while wireless composed 38% and media provided the remainder.

The company was formerly known as Bell Canada Enterprises Inc. 

BCE Inc. was founded in 1880 and is headquartered in Verdun, Canada.

Three key data points gauge dividend equities or funds like BCE Inc. (BCE):

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money. 

BCE Price

BCE's price per share was $51.12 as of yesterday's market close. One year ago its price was $42.61. So, BCE's share price increased by nearly 20% in the past year.

If BCE's stock trades in the range of $40 to $55.00 this next year, its recent $51.12 price will likely rise by $1.38 by October 19, 2022. My estimate is based on the trajectory traced by the past ten years of price data and is $1.33 higher than the median of 3 analysts' one-year target estimates who follow the stock for brokers.  

BCE Dividends

BCE's most recent Q dividend of  $0.69 paid out on October 15, to shareholders. That equates to an annual payout of $2.77  and yields 5.41% based on yesterday's $51.12 closing price. BCE has paid regular variable quarterly dividends since January 1985. That's 36 years. 

BCE Returns

Adding the $2.77 annual estimated  BCE forward-looking dividend to my $1.38 price upside estimate shows a $4.15 potential gross gain, per share, to be reduced by any costs to trade BCE shares.  

At yesterday's $51.12 price per share, a little over $1000 would buy 21 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at sale and might cost us about $0.50 per share.

Subtract that maybe $0.50  brokerage cost from my estimated $4.15 gross gain per share results in a net gain of $3.65 X 20 shares = $73.00 for a 7.25% net gain on a $1,022.60 investment.

So it is that BCE Inc. (BCE) shows a possible 7.25% net gain including a 5.41% forward estimated dividend yield. 

Over the next year at this time, a $1000 investment in BCE Inc. (BCE) could generate $54.10 in cash dividends alone. And a single share bought at yesterday's closing price was $51.12! Thus, BCE's share price is $2.98 less than the dividend income from $1K invested. So, according to my dogcatcher ideal, now is the time to pickup BCE shares. The estimated next year's dividend from $1k invested is nearly $3.00 greater than the single share price. Consider yourself alerted. It's a sign! 

All of the estimates above are speculation based on the past history of BCE Inc. (BCE). Only time and money invested in this stock will determine its market value.

Disclaimer:  This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...

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Craig Richards 2 years ago Member's comment

Thanks Fredrik Arnold. $BCE is looking good!