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A Top Stock in Telecom

We think this company is well-positioned to increase market share.

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The pandemic has materially affected the businesses of Canada's wireless carriers. Not only do we believe the industry in general is poised for dramatic business improvement when the pandemic ends, but we think BCE's business in particular is best positioned among its peers: We think it's favorably positioned in both wireless and wireline.

Over much of its wireline footprint, we think BCE is now a strong alternative to other cable companies, including Rogers, its primary competitor. Historically, BCE's copper-based network has offered less quality than cable competitors for television and broadband service. However, over the last several years, BCE has been building out fiber to the home, which now passes about 5.5 million homes and businesses. With its anticipated fiber-to-the-home build-out now nearly 60% complete, we believe it is substantial enough to impact results in the near term, and we think the runway extends for several years, as it continues increasing the number of homes it passes. The company eventually intends to pass 9 million to 12 million homes and business. It is also looking to upgrade service to more rural locations with its fixed wireless offering, which is now available in over 400,000 locations.

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