Q: I am left wondering if your romance with BCE remains warm and positive for a future together, or might there be a separation pending? Is BCE’s vibe a little too “landline in a wireless world?
5i Research Answer:
We are not sure the romance could be classified as 'warm', but more of an 'acceptance'. The stock is hardly perfect, but may be in the process of bottoming, and sentiment is so weak that any positive news would be very positive for the stock. Investors expect a dividend cut, and the stock may rise if such an even occurs. Its cash flow may be helpful if the economy rolls over, as it appears to be doing. It is not risk-free, but we are OK with a small position and slow accumulation for investors who understand the situation.