BCE Inc.
Toronto symbol BCE, provides local and long distance telephone services in Ontario and Quebec. It also operates a nationwide wireless service.
Adding strength with timely U.S. acquisitions, Royal Bank and TD Bank bolster their status as solid blue chips stocks in a sluggish economy.
Shaw Communications, $26.76, symbol SJR.B on Toronto (Shares outstanding: 469.1 million; Market cap: $12.7 billion; www.shaw.ca), is one of Canada’s largest cable TV operators. The company has 1.9 million basic cable subscribers (mostly in Western Canada) and 851,569 satellite customers through its ownership of Shaw Direct. It also provides high-speed Internet to 1.9 million clients and telephone services to another 1.3 million. In September 2014, Shaw completed its $1.2-billion purchase of Colorado-based ViaWest, a privately held operator of data centres, cloud storage and information technology services. ViaWest has 27 data centres in the western United States....
BCE INC., $54.14, Toronto symbol BCE, continues to see strong demand for its wireless, high-speed Internet and Fibe TV services. In the three months ended June 30, 2015, the company’s earnings rose 14.8%, to $735 million from $640 million a year earlier. Per-share profits gained just 6.1%, to $0.87 from $0.82, on more shares outstanding. These figures exclude unusual items, such as costs to integrate BCE’s November 2014 purchase of the 56% of Bell Aliant it didn’t already own. On that basis, the latest earnings matched the consensus estimate....
BCE INC. $54.16 (Toronto symbol BCE; Shares outstanding: 847.9 million; Market cap: $45.7 billion; TSINetwork Rating: Above Average; Dividend yield: 4.8%; www.bce.ca) is Canada’s largest provider of telephone, Internet and wireless services. It also offers satellite and Internet TV across the country. In the three months ended June 30, 2015, BCE’s earnings per share rose 6.1%, to $0.87 from $0.82 a year earlier. Revenue increased 2.0%, to $5.33 billion from $5.22 billion. BCE gained 22,110 wireless subscribers, net of losses, in the latest quarter. It signed up 61,033 new users under long-term contracts, up 72.5% from a year earlier. That’s important, as these customers tend to use smartphones, which generate higher monthly fees than regular cellphones....
Our outlook on blue chip stock Manitoba Telecom as its shares begin to recover in the wake of a strategic review and network upgrades.
Pumping $27 billion into network upgrades helps keep Telus competitive in the telecom race we see it as a clear buy among blue chip stocks.
BCE INC. $55 (Toronto symbol BCE; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 841.9 million; Market cap: $46.3 billion; Price-to-sales ratio: 2.2; Dividend yield: 4.7%; TSINetwork Rating: Above Average; www.bce.ca) is Canada’s largest telephone provider, with 7.0 million customers in Ontario, Quebec and the Atlantic provinces. It also has 3.3 million highspeed Internet users and 2.7 million TV subscribers. This business supplies 57% of BCE’s revenue. The company also sells wireless services (31% of revenue) to 8.1 million customers across Canada, and its Bell Media segment (12%) owns CTV Television, specialty channels and radio stations. In the three months ended March 31, 2015, BCE’s overall earnings rose 12.6%, to $705 million from $626 million a year earlier. But per-share profits gained just 3.7%, to $0.84 from $0.81, on more shares outstanding. Revenue rose 2.8%, to $5.24 billion from $5.10 billion....
MANITOBA TELECOM SERVICES INC. $29 (Toronto symbol MBT; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 78.5 million; Market cap: $2.3 billion; Price-to-sales ratio: 1.4; Dividend yield: 4.5%; TSINetwork Rating: Average; www.mtsallstream.com) gets 60% of its revenue from its MTS division, which has 1.3 million telephone, wireless and TV customers in Manitoba. The other 40% comes from Allstream, which sells phone and Internet services to businesses across Canada. The company recently completed a strategic review of its operations. As a result, it now plans to cut 25% of Allstream’s workforce and reduce the subsidiary’s capital spending by 20% to 30% in 2015. These moves should save Manitoba Telecom $50 million annually by the end of 2016. In addition, the company will contribute $120 million to its underfunded employees’ pension plan, eliminating the need for additional payments over the next two years. It has also cut its dividend by 23.5%: the new annual rate of $1.30 a share yields 4.5%....
BCE meets our “buy” criteria for blue chip stocks as it adds new services, speeds up its network and keeps its dividend safe and rising.
ISHARES CANADIAN SELECT DIVIDEND INDEX ETF $23.07 (Toronto symbol XDV; buy or sell through brokers; ca.ishares.com) holds 30 of the highestyielding Canadian stocks. Its selections are based on dividend growth, yield and payout ratio. The weight of any one stock is limited to 10% of the ETF’s assets. The fund’s MER is 0.55%, and it yields 4.5%. The fund’s top holdings are CIBC, 8.5%; Bank of Montreal, 6.3%; Royal Bank, 6.3%; Bank of Nova Scotia, 5.4%; BCE, 5.3%; Laurentian Bank of Canada, 4.4%; IGM Financial, 4.3%; TD Bank, 4.1%; National Bank, 4.1%; Rogers Communications, 4.1%; and TransCanada Corp., 4.0%.
The ETF holds 53.7% of its assets in financial stocks. The top Canadian finance stocks have sound prospects, but if you invest in this ETF, be sure to adjust the rest of your portfolio so it won’t be overly concentrated in the financial sector.
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