BCE INC (BCE.CA) Stock Fundamental Analysis
TSX:BCE - Toronto Stock Exchange - CA05534B7604 - Common Stock - Currency: CAD
We assign a fundamental rating of 3 out of 10 to BCE. BCE was compared to 30 industry peers in the Diversified Telecommunication Services industry. Both the profitability and financial health of BCE have multiple concerns. BCE is valued expensive and it does not seem to be growing. Finally BCE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year BCE was profitable.
BCE had a positive operating cash flow in the past year.
BCE had positive earnings in each of the past 5 years.
BCE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 0.22%, BCE is not doing good in the industry: 83.33% of the companies in the same industry are doing better.
With a Return On Equity value of 0.95%, BCE is not doing good in the industry: 83.33% of the companies in the same industry are doing better.
Looking at the Return On Invested Capital, with a value of 5.18%, BCE is doing worse than 80.00% of the companies in the same industry.
BCE had an Average Return On Invested Capital over the past 3 years of 4.90%. This is in line with the industry average of 5.52%.
The last Return On Invested Capital (5.18%) for BCE is above the 3 year average (4.90%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.22% | ||
| ROE | 0.95% | ||
| ROIC | 5.18% |
ROA(3y)2.34%
ROA(5y)3.04%
ROE(3y)7.82%
ROE(5y)9.47%
ROIC(3y)4.9%
ROIC(5y)4.97%
1.3 Margins
BCE has a worse Profit Margin (0.67%) than 83.33% of its industry peers.
BCE's Profit Margin has declined in the last couple of years.
BCE has a worse Operating Margin (22.73%) than 83.33% of its industry peers.
BCE's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 68.43%, BCE is not doing good in the industry: 76.67% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of BCE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.73% | ||
| PM (TTM) | 0.67% | ||
| GM | 68.43% |
OM growth 3Y0.29%
OM growth 5Y-0.91%
PM growth 3Y-61.33%
PM growth 5Y-44.58%
GM growth 3Y-0.23%
GM growth 5Y-0.19%
2. Health
2.1 Basic Checks
BCE has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for BCE remains at a similar level compared to 1 year ago.
The number of shares outstanding for BCE has been increased compared to 5 years ago.
BCE has a worse debt/assets ratio than last year.
2.2 Solvency
BCE has an Altman-Z score of 0.62. This is a bad value and indicates that BCE is not financially healthy and even has some risk of bankruptcy.
With an excellent Altman-Z score value of 0.62, BCE belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
BCE has a debt to FCF ratio of 14.54. This is a negative value and a sign of low solvency as BCE would need 14.54 years to pay back of all of its debts.
With a Debt to FCF ratio value of 14.54, BCE is not doing good in the industry: 73.33% of the companies in the same industry are doing better.
BCE has a Debt/Equity ratio of 1.92. This is a high value indicating a heavy dependency on external financing.
BCE has a Debt to Equity ratio of 1.92. This is in the lower half of the industry: BCE underperforms 76.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.92 | ||
| Debt/FCF | 14.54 | ||
| Altman-Z | 0.62 |
ROIC/WACC1.11
WACC4.67%
2.3 Liquidity
BCE has a Current Ratio of 0.60. This is a bad value and indicates that BCE is not financially healthy enough and could expect problems in meeting its short term obligations.
BCE has a worse Current ratio (0.60) than 83.33% of its industry peers.
BCE has a Quick Ratio of 0.60. This is a bad value and indicates that BCE is not financially healthy enough and could expect problems in meeting its short term obligations.
BCE has a Quick ratio of 0.57. This is amonst the worse of the industry: BCE underperforms 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
BCE shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.30%.
The Earnings Per Share has been decreasing by -2.78% on average over the past years.
BCE shows a decrease in Revenue. In the last year, the revenue decreased by -1.07%.
Measured over the past years, BCE shows a small growth in Revenue. The Revenue has been growing by 0.51% on average per year.
EPS 1Y (TTM)-5.3%
EPS 3Y-1.59%
EPS 5Y-2.78%
EPS Q2Q%3.95%
Revenue 1Y (TTM)-1.07%
Revenue growth 3Y1.35%
Revenue growth 5Y0.51%
Sales Q2Q%-0.79%
3.2 Future
Based on estimates for the next years, BCE will show a small growth in Earnings Per Share. The EPS will grow by 6.71% on average per year.
The Revenue is expected to grow by 2.25% on average over the next years.
EPS Next Y-8.98%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
EPS Next 5Y6.71%
Revenue Next Year0.02%
Revenue Next 2Y1.13%
Revenue Next 3Y0.96%
Revenue Next 5Y2.25%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.88, the valuation of BCE can be described as reasonable.
73.33% of the companies in the same industry are cheaper than BCE, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.79, BCE is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.85, the valuation of BCE can be described as very reasonable.
Based on the Price/Forward Earnings ratio, BCE is valued a bit more expensive than the industry average as 76.67% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of BCE to the average of the S&P500 Index (21.38), we can say BCE is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.88 | ||
| Fwd PE | 10.85 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BCE is valued a bit more expensive than the industry average as 73.33% of the companies are valued more cheaply.
76.67% of the companies in the same industry are cheaper than BCE, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.94 | ||
| EV/EBITDA | 6.22 |
4.3 Compensation for Growth
BCE's earnings are expected to decrease with -2.78% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 13.09%, BCE is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 11.62, BCE pays a better dividend. On top of this BCE pays more dividend than 100.00% of the companies listed in the same industry.
BCE's Dividend Yield is rather good when compared to the S&P500 average which is at 2.47.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.09% |
5.2 History
The dividend of BCE has a limited annual growth rate of 4.82%.
BCE has paid a dividend for at least 10 years, which is a reliable track record.
BCE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.82%
Div Incr Years16
Div Non Decr Years16
5.3 Sustainability
2331.29% of the earnings are spent on dividend by BCE. This is not a sustainable payout ratio.
The dividend of BCE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP2331.29%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
TSX:BCE (4/25/2025, 7:00:00 PM)
30.03
-0.45 (-1.48%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners43.19%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap27.68B
Analysts50.91
Price Target35.31 (17.58%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.09% |
Yearly Dividend4.17
Dividend Growth(5Y)4.82%
DP2331.29%
Div Incr Years16
Div Non Decr Years16
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2.75%
Min EPS beat(2)-3.58%
Max EPS beat(2)9.09%
EPS beat(4)2
Avg EPS beat(4)1.8%
Min EPS beat(4)-3.58%
Max EPS beat(4)9.09%
EPS beat(8)4
Avg EPS beat(8)1.97%
EPS beat(12)7
Avg EPS beat(12)2.4%
EPS beat(16)10
Avg EPS beat(16)2.68%
Revenue beat(2)1
Avg Revenue beat(2)-0.91%
Min Revenue beat(2)-1.99%
Max Revenue beat(2)0.17%
Revenue beat(4)1
Avg Revenue beat(4)-1.32%
Min Revenue beat(4)-1.99%
Max Revenue beat(4)0.17%
Revenue beat(8)2
Avg Revenue beat(8)-1.12%
Revenue beat(12)2
Avg Revenue beat(12)-1.01%
Revenue beat(16)3
Avg Revenue beat(16)-1.04%
PT rev (1m)-1.64%
PT rev (3m)-14.83%
EPS NQ rev (1m)-2.34%
EPS NQ rev (3m)-5.3%
EPS NY rev (1m)-0.29%
EPS NY rev (3m)-4.08%
Revenue NQ rev (1m)-0.38%
Revenue NQ rev (3m)-1.77%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.88 | ||
| Fwd PE | 10.85 | ||
| P/S | 1.13 | ||
| P/FCF | 9.94 | ||
| P/OCF | 3.84 | ||
| P/B | 1.62 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.22 |
EPS(TTM)3.04
EY10.12%
EPS(NY)2.77
Fwd EY9.21%
FCF(TTM)3.02
FCFY10.06%
OCF(TTM)7.82
OCFY26.06%
SpS26.48
BVpS18.52
TBVpS-10.82
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.22% | ||
| ROE | 0.95% | ||
| ROCE | 9.46% | ||
| ROIC | 5.18% | ||
| ROICexc | 5.36% | ||
| ROICexgc | 10.25% | ||
| OM | 22.73% | ||
| PM (TTM) | 0.67% | ||
| GM | 68.43% | ||
| FCFM | 11.41% |
ROA(3y)2.34%
ROA(5y)3.04%
ROE(3y)7.82%
ROE(5y)9.47%
ROIC(3y)4.9%
ROIC(5y)4.97%
ROICexc(3y)5.01%
ROICexc(5y)5.05%
ROICexgc(3y)9.15%
ROICexgc(5y)9.15%
ROCE(3y)9.37%
ROCE(5y)9.44%
ROICexcg growth 3Y1.14%
ROICexcg growth 5Y-3.03%
ROICexc growth 3Y0.85%
ROICexc growth 5Y-2.9%
OM growth 3Y0.29%
OM growth 5Y-0.91%
PM growth 3Y-61.33%
PM growth 5Y-44.58%
GM growth 3Y-0.23%
GM growth 5Y-0.19%
F-Score5
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.92 | ||
| Debt/FCF | 14.54 | ||
| Debt/EBITDA | 3.1 | ||
| Cap/Depr | 87.84% | ||
| Cap/Sales | 18.14% | ||
| Interest Coverage | 3.15 | ||
| Cash Conversion | 68.12% | ||
| Profit Quality | 1708.59% | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.57 | ||
| Altman-Z | 0.62 |
F-Score5
WACC4.67%
ROIC/WACC1.11
Cap/Depr(3y)97.8%
Cap/Depr(5y)98.75%
Cap/Sales(3y)19.56%
Cap/Sales(5y)19.53%
Profit Quality(3y)656.86%
Profit Quality(5y)446%
High Growth Momentum
Growth
EPS 1Y (TTM)-5.3%
EPS 3Y-1.59%
EPS 5Y-2.78%
EPS Q2Q%3.95%
EPS Next Y-8.98%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
EPS Next 5Y6.71%
Revenue 1Y (TTM)-1.07%
Revenue growth 3Y1.35%
Revenue growth 5Y0.51%
Sales Q2Q%-0.79%
Revenue Next Year0.02%
Revenue Next 2Y1.13%
Revenue Next 3Y0.96%
Revenue Next 5Y2.25%
EBIT growth 1Y0.89%
EBIT growth 3Y1.64%
EBIT growth 5Y-0.41%
EBIT Next Year92.66%
EBIT Next 3Y25.9%
EBIT Next 5Y16.03%
FCF growth 1Y-7.38%
FCF growth 3Y-4.23%
FCF growth 5Y-6.84%
OCF growth 1Y-7.18%
OCF growth 3Y-3.43%
OCF growth 5Y-1.95%