Q: Does the decline in Telus and Bell have any similarities to the decline in AT&T and Verizon about 6 months ago? I note that the US telecoms staged a nice comeback since. Would you expect the same or are the stories different?
5i Research Answer:
The moves would be fairly similar, with some of the same reasons. However, the US market is much more competitive and has more price wars, which can make the US sector even more volatile. Like in Canada, investors in the US worry about dividend sustainability. At some point, rates will fall in Canada and sentiment will be so negative that any good news might move the stocks higher. Such moves are hard to call, but generally when 'everyone' is worried then stocks can bottom.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in VZ.