Finding the right mix of investments for your portfolio can make the difference between retiring comfortably or working a few extra years. Fortunately, there are plenty of options on the market to help establish that right mix, and now might be the right time to buy.
Here’s a look at BCE (TSX:BCE) and why this is the right time to buy BCE stock.
First, an introduction
Most investors are aware of BCE, but few truly realize the complete scope of what the telecom offers. Apart from being one of the largest telecoms in Canada, BCE also operates a massive media segment.
That media business provides an alternative, yet complementary revenue stream to its core subscription business. In fact, BCE’s media segment blankets the entire country and enhances what is already a sizable defensive moat.
That moat primarily comes thanks to BCE’s core subscription business. The company offers wireline, wireless, internet, and TV service across its nationwide network. And while the defensive appeal of telecoms like BCE is well-known, that appeal has increased in recent years.
When the pandemic forced office workers to become remote warriors, the need for a fast and reliable internet connection became one of necessity. And several years on, that necessity persists. In the most recent quarter, BCE reported 79,327 net activations, reflecting 6.1% growth over the prior period.
That same reliance can be said of BCE’s wireless segment. The most recent quarter proved to be the second-best quarterly result for the segment ever. During that quarter, BCE saw 231,212 total mobile phone and connected device activations.
But what makes it the right time to buy BCE?
Now is the right time to buy BCE
If there’s a single word to sum up the market in 2023, it’s volatile. Conflicts, rising interest rates, crazy inflation, we’ve seen it all this year.
And that market volatility has played a role in pushing much of the market, and BCE, lower. As of the time of writing, BCE trades down 13% over the trailing 12-month period.
Year to date, the stock’s performance improves slightly, but it’s still down 6%.
In other words, prospective investors considering the right time to buy BCE stock can pick up shares of the telecom at a decent discount right now.
Oh, and perhaps best of all, that discounted stock price also means that BCE’s dividend has swelled to a juicy 7.04%. This handily makes the stock one of the best-paying dividend stocks on the market.
As an income stock, BCE really shines. The telecom has provided investors with a tasty quarterly dividend without fail for well over a century. Additionally, BCE has provided investors with an annual or better uptick to that dividend for over a decade.
For prospective investors with $30,000 to drop into BCE, that works out to an income of $2,080. Remember that investors who aren’t ready to draw on that income can reinvest it until needed, allowing it to grow further.
No investment is without risk, and that includes BCE. The rising interest rates we’ve seen over the past year have impacted debt-heavy businesses like telecoms. Fortunately, BCE offers investors a huge defensive moat to offset some of that risk.
Factor in the swollen yield and long-term appeal of the stock, and you have both a great long-term stock for any portfolio.
In my opinion, BCE is an excellent addition to any long-term portfolio, and with its current discount, it really is the right time to buy.