March 28, 2024
Top 10 Stock BCE Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: BCE – Top 10 Stock in Renewable Energy Use Leaders
BCE is listed as a top 10 stock on March 28, 2024 in the market index Renewables Users because of its high performance in at least one of the Obermatt investment strategies. All consolidated Obermatt Ranks are below-average. Based on the Obermatt Method, an investment in the company is not advisable today. Based on the Obermatt 360° View of 26 (26% performer), Obermatt assesses an overall hold recommendation for BCE on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Canada |
| Industry | Integrated Telecommunication |
| Index | Renewables Users, Recycling, Telecommunications, TSX Composite |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View BCE Hold
| 360 METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 32 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 39 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 34 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 47 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 26 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 26 (better than 26% compared with alternatives), overall professional sentiment and financial characteristics for the stock BCE are below the industry average. The 360° View is based on consolidating four consolidated indicators, with all four indicators below average for BCE. The consolidated Value Rank has a low rank of 32 which means that the share price of BCE is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 68% of alternative stocks in the same industry. The consolidated Growth Rank also has a low rank of 39, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is lower than for 39% of competitors in the same industry. The consolidated Safety Rank has a riskier rank of 34, which means that the company has a riskier financing structure than 66% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a low rank of 47, which means that professional investors are more pessimistic about the stock than for 53% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 26, BCE is worse than 74% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks are below-average, this is a risky stock investment proposition, especially since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 47. The negative market view on BCE may stem from the high stock price (low value), the low level of growth, or the risky financing structures. That's several problems with no good news anywhere. Based on the current information, we don’t see any compelling arguments to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not confirmed by investor behavior today. While BCE may have a bright future, it is reflected in neither the financial indicators nor the market sentiment. ...read more
Sentiment Strategy: Professional Market Sentiment for BCE only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 47 (better than 47% compared with alternatives), overall professional sentiment and engagement for the stock BCE is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for BCE. Analyst Opinions are at a rank of 24 (worse than 76% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 32, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 63, which means that professional investors hold more stock in this company than in 63% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 54, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 54% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to BCE and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 47 (less encouraging than 53% compared with investment alternatives), BCE has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: BCE Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 32 (worse than 68% compared with alternatives), BCE shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for BCE. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 100% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 24 which means that the stock price compared with what market professionals expect for future profits is higher than 76% of comparable companies, indicating a low value concerning BCE's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 31 which means that the stock price compared with what market professionals expect for future profit levels is higher than 69% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 27 is also low. Compared with invested capital, the stock price is higher than for 73% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 32, is a hold recommendation based on BCE's stock price compared with the company's operational size and dividend yields. Should dividend investors pick BCE? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose BCE only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: BCE Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), BCE shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below-average for BCE. While Sales Growth ranks at 55, professionals currently expect the company to grow more than 55% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 25, which means that, currently, professionals expect the company to grow its profits less than 75% of its competitors, and Capital Growth has a low rank of 44. Historic stock returns were also below average with a current Stock Returns rank of 45 which means that the stock returns have recently been below 55% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, is a hold recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: BCE Debt Financing Safety below-average
| SAFETY METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 36 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 25 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 73 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 34 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 34 (better than 34% compared with alternatives), the company BCE has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of BCE is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for BCE. Liquidity is at 73, meaning the company generates more profit to service its debt than 73% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 25, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 75% of its competitors. Leverage is also high at a rank of 36, which means that the company has an above-average debt-to-equity ratio. It has more debt than 64% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 34 (worse than 66% compared with alternatives), BCE has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: BCE Lowest Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 32 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 39 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 73 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 19 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 19 (worse than 81% compared with investment alternatives), BCE (Integrated Telecommunication, Canada) shares have lower financial characteristics compared with similar stocks. Shares of BCE are low in value (priced high) with a consolidated Value Rank of 32 (worse than 68% of alternatives), show below-average growth (Growth Rank of 39), and are riskily financed (Safety Rank of 34), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 19, is a sell recommendation based on BCE's financial characteristics. As the company BCE's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 32), low growth (Obermatt Growth Rank of 39), and risky financing practices (Obermatt Safety Rank of 34), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.