BCE is our top telecom pick

Article Excerpt

The arrival of new wireless providers has put pressure on Canada’s three main telecommunications companies (BCE, Telus and Rogers). To remain competitive, all three are offering subscribers better long-term deals. They are also making big investments in new wireless and high-speed Internet technologies. However, these moves are also dampening their profits. Still, demand for wireless services continues to rise, and we feel BCE’s broad geographic reach puts it in the best position to profit from that trend. The improving economy should also push up ad sales at its TV stations and other media businesses. Moreover, the company recently went through a significant restructuring. That will increase its long-term profits and give it more cash for dividends. BCE INC. $41 (Toronto symbol BCE; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 774.0 million; Market cap: $31.7 billion; Price-to-sales ratio: 1.6; Dividend yield: 5.3%; TSINetwork Rating: Above Average; www.bce.ca) is Canada’s largest provider of telephone services. BCE’s main subsidiary, Bell Canada, has 6.1 million telephone customers in Ontario…