Analyst Tim Casey from BMO Capital reiterated a Hold rating on BCE and keeping the price target at C$37.00.
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Tim Casey has given his Hold rating due to a combination of factors including BCE’s financial guidance and growth prospects. The company has set financial targets through 2028 that slightly exceed consensus forecasts for revenue and EBITDA growth, with free cash flow guidelines aligning with expectations. However, there is an anticipated slight contraction in operating margins, primarily due to growth in the Enterprise segment.
Additionally, BCE is focusing on expanding its AI-Powered Solutions business, aiming to double its size over the next three years while maintaining stable revenues in its legacy Enterprise Communications. Despite ongoing cost-saving initiatives and a stable dividend payout ratio, challenges such as the initial stages of copper decommissioning and real estate monetization contribute to the Hold rating. The growth challenges and relative valuation of BCE’s shares, along with stable revenue and EBITDA performance, underpin the Market Perform rating.
In another report released today, Canaccord Genuity also maintained a Hold rating on the stock with a C$32.00 price target.
BCE’s price has also changed slightly for the past six months – from $21.650 to $23.330, which is a 7.76% increase.