Q: While you may not see much growth in Bell for the near future, is this not a rare opportunity for a dividend/income investor to lock in an 8%+ dividend in a secure company?
Am I missing something?
Am I missing something?
5i Research Answer:
The stock is priced well and still expects small dividend increases. But sentiment is highly negative, and some investors are worried the dividend will actually be reduced. Capital losses are still possible if sentiment weakens or rates do not fall as expected, or earnings estimates are missed. Investors have lost 17% in the past year, more than offsetting the dividend. We think it is OK for income and a HOLD, but it is not a slam dunk and not as low risk as it has been for the past decade.