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BCE Inc. (BCE)
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TELUS Corporation (T)
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TELUS International (Cda) Inc. Subordinate Voting Shares (TIXT)
Q: Hi, Telco stocks have been weak for past few months , with new 52 weeks lows. perhaps due to pressure from increased competition ( Rogers/Shaw) and rising interest rates. Many analysts have also revised their price targets lower, in anticipation of weak results and soft outlook, at least in the near term.
My question is more specific to Telus, which was hit hard today, due to lower guidance announced by TIXT. Although, TIXT accounts for only 10% of Telus revenues/earnings, but it appears to be a continuous drag for the parent co. I know, 5i hold TIXT in its portfolio and has been supporting to own the stock, despite its downward trajectory for a long time. Telus now faces not just industry challenge from its peers, but also additional impact with negative and uncertain outlook for TIXT.
In light of this, if we wish to own only one Telco, would it be safer and
My question is more specific to Telus, which was hit hard today, due to lower guidance announced by TIXT. Although, TIXT accounts for only 10% of Telus revenues/earnings, but it appears to be a continuous drag for the parent co. I know, 5i hold TIXT in its portfolio and has been supporting to own the stock, despite its downward trajectory for a long time. Telus now faces not just industry challenge from its peers, but also additional impact with negative and uncertain outlook for TIXT.
In light of this, if we wish to own only one Telco, would it be safer and
5i Research Answer:
Generally, we have preferred T over BCE for growth. But with recent events, the playing field is likely levelled out. BCE we would consider 'safer' overall, and thus we would lean towards it today if only one is to be owned.