Q: Can I get your thoughts on the recent earnings? I don't see any comments on it yet.
Also I see previously you replied on Oct 3rd "No dividend is ever guaranteed, but BCE has a very solid record. 12-month payout ratio is less than 50% on operating cash flow."
Can you provide me some insight on why you referenced operating cash flow and not (levered) free cash flow? Is this because BCE has a capex intensive business at times and its free cash flow can vary significantly quarter to quarter and year to year or are there other reasons? Thanks
Also I see previously you replied on Oct 3rd "No dividend is ever guaranteed, but BCE has a very solid record. 12-month payout ratio is less than 50% on operating cash flow."
Can you provide me some insight on why you referenced operating cash flow and not (levered) free cash flow? Is this because BCE has a capex intensive business at times and its free cash flow can vary significantly quarter to quarter and year to year or are there other reasons? Thanks
5i Research Answer:
Earnings comments are now posted. We prefer operating cash flow, as some (not all) spending is discretionary and option (like buybacks, acquisitions and so on). Depreciation is a big part of cash flow, and cap ex does vary widely. Investors can look at free cash flow as well, but we like to first look at how much cash the actual operating business generates.