BCE INC (BCE) Stock Fundamental Analysis
NYSE:BCE - New York Stock Exchange, Inc. - CA05534B7604 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to BCE. BCE was compared to 33 industry peers in the Diversified Telecommunication Services industry. There are concerns on the financial health of BCE while its profitability can be described as average. BCE is valued correctly, but 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.
Each year in the past 5 years BCE has been profitable.
BCE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
BCE has a Return On Assets (0.54%) which is in line with its industry peers.
BCE has a Return On Equity of 2.26%. This is comparable to the rest of the industry: BCE outperforms 54.55% of its industry peers.
BCE's Return On Invested Capital of 7.28% is fine compared to the rest of the industry. BCE outperforms 75.76% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BCE is in line with the industry average of 7.13%.
The 3 year average ROIC (7.08%) for BCE is below the current ROIC(7.28%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.54% | ||
| ROE | 2.26% | ||
| ROIC | 7.28% |
ROA(3y)2.34%
ROA(5y)3.04%
ROE(3y)7.82%
ROE(5y)9.47%
ROIC(3y)7.08%
ROIC(5y)7.18%
1.3 Margins
BCE's Profit Margin of 1.61% is in line compared to the rest of the industry. BCE outperforms 54.55% of its industry peers.
BCE's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 22.74%, BCE belongs to the best of the industry, outperforming 84.85% of the companies in the same industry.
In the last couple of years the Operating Margin of BCE has remained more or less at the same level.
BCE has a Gross Margin of 68.27%. This is amongst the best in the industry. BCE outperforms 81.82% of its industry peers.
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 | 22.74% | ||
| PM (TTM) | 1.61% | ||
| GM | 68.27% |
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BCE is creating some value.
The number of shares outstanding for BCE remains at a similar level compared to 1 year ago.
BCE has more shares outstanding than it did 5 years ago.
The debt/assets ratio for BCE is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.68, we must say that BCE is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.68, BCE is doing worse than 60.61% of the companies in the same industry.
BCE has a debt to FCF ratio of 11.06. This is a negative value and a sign of low solvency as BCE would need 11.06 years to pay back of all of its debts.
BCE has a Debt to FCF ratio (11.06) which is in line with its industry peers.
BCE has a Debt/Equity ratio of 1.95. This is a high value indicating a heavy dependency on external financing.
BCE's Debt to Equity ratio of 1.95 is on the low side compared to the rest of the industry. BCE is outperformed by 69.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.95 | ||
| Debt/FCF | 11.06 | ||
| Altman-Z | 0.68 |
ROIC/WACC1.41
WACC5.17%
2.3 Liquidity
BCE has a Current Ratio of 0.64. This is a bad value and indicates that BCE is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of BCE (0.64) is worse than 84.85% of its industry peers.
BCE has a Quick Ratio of 0.64. 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's Quick ratio of 0.61 is on the low side compared to the rest of the industry. BCE is outperformed by 84.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
The earnings per share for BCE have decreased by -2.27% in the last year.
Measured over the past years, BCE shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.78% on average per year.
Looking at the last year, BCE shows a decrease in Revenue. The Revenue has decreased by -1.23% in the last year.
BCE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.51% yearly.
EPS 1Y (TTM)-2.27%
EPS 3Y-1.59%
EPS 5Y-2.78%
EPS Q2Q%-4.17%
Revenue 1Y (TTM)-1.23%
Revenue growth 3Y1.35%
Revenue growth 5Y0.51%
Sales Q2Q%-1.35%
3.2 Future
The Earnings Per Share is expected to grow by 7.91% on average over the next years.
BCE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.89% yearly.
EPS Next Y-8.98%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
EPS Next 5Y7.91%
Revenue Next Year-0.1%
Revenue Next 2Y1.06%
Revenue Next 3Y0.85%
Revenue Next 5Y1.89%
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
The Price/Earnings ratio is 10.82, which indicates a very decent valuation of BCE.
Based on the Price/Earnings ratio, BCE is valued cheaper than 90.91% of the companies in the same industry.
BCE is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 12.07, which indicates a correct valuation of BCE.
75.76% of the companies in the same industry are more expensive than BCE, based on the Price/Forward Earnings ratio.
BCE's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.82 | ||
| Fwd PE | 12.07 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BCE indicates a somewhat cheap valuation: BCE is cheaper than 72.73% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, BCE is valued a bit cheaper than the industry average as 69.70% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.49 | ||
| EV/EBITDA | 6.45 |
4.3 Compensation for Growth
BCE has a very decent profitability rating, which may justify a higher PE ratio.
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
BCE has a Yearly Dividend Yield of 6.91%, which is a nice return.
Compared to an average industry Dividend Yield of 5.05, BCE pays a better dividend. On top of this BCE pays more dividend than 87.88% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, BCE pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.91% |
5.2 History
The dividend of BCE has a limited annual growth rate of 4.82%.
BCE has been paying a dividend for at least 10 years, so it has 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
898.21% 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.
DP898.21%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
23.81
-0.25 (-1.04%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners47.35%
Inst Owner Change0%
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap21.95B
Analysts53.64
Price Target25.24 (6.01%)
Short Float %5.49%
Short Ratio15.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.91% |
Yearly Dividend3.04
Dividend Growth(5Y)4.82%
DP898.21%
Div Incr Years16
Div Non Decr Years16
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.87%
Min EPS beat(2)9.09%
Max EPS beat(2)10.64%
EPS beat(4)2
Avg EPS beat(4)3.75%
Min EPS beat(4)-3.58%
Max EPS beat(4)10.64%
EPS beat(8)4
Avg EPS beat(8)2.18%
EPS beat(12)7
Avg EPS beat(12)2.52%
EPS beat(16)10
Avg EPS beat(16)2.92%
Revenue beat(2)1
Avg Revenue beat(2)-0.35%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)0.17%
Revenue beat(4)1
Avg Revenue beat(4)-1.15%
Min Revenue beat(4)-1.99%
Max Revenue beat(4)0.17%
Revenue beat(8)1
Avg Revenue beat(8)-1.24%
Revenue beat(12)2
Avg Revenue beat(12)-1%
Revenue beat(16)2
Avg Revenue beat(16)-1.16%
PT rev (1m)0.03%
PT rev (3m)0.92%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-1.78%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.29%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)-0.2%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.82 | ||
| Fwd PE | 12.07 | ||
| P/S | 1.24 | ||
| P/FCF | 8.49 | ||
| P/OCF | 3.96 | ||
| P/B | 1.73 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.45 |
EPS(TTM)2.2
EY9.24%
EPS(NY)1.97
Fwd EY8.29%
FCF(TTM)2.81
FCFY11.79%
OCF(TTM)6.01
OCFY25.26%
SpS19.26
BVpS13.72
TBVpS-7.64
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.54% | ||
| ROE | 2.26% | ||
| ROCE | 9.21% | ||
| ROIC | 7.28% | ||
| ROICexc | 7.41% | ||
| ROICexgc | 13.65% | ||
| OM | 22.74% | ||
| PM (TTM) | 1.61% | ||
| GM | 68.27% | ||
| FCFM | 14.57% |
ROA(3y)2.34%
ROA(5y)3.04%
ROE(3y)7.82%
ROE(5y)9.47%
ROIC(3y)7.08%
ROIC(5y)7.18%
ROICexc(3y)7.23%
ROICexc(5y)7.29%
ROICexgc(3y)13.21%
ROICexgc(5y)13.21%
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-Score6
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.95 | ||
| Debt/FCF | 11.06 | ||
| Debt/EBITDA | 3.2 | ||
| Cap/Depr | 80.2% | ||
| Cap/Sales | 16.65% | ||
| Interest Coverage | 2.95 | ||
| Cash Conversion | 71.77% | ||
| Profit Quality | 906.39% | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.61 | ||
| Altman-Z | 0.68 |
F-Score6
WACC5.17%
ROIC/WACC1.41
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)-2.27%
EPS 3Y-1.59%
EPS 5Y-2.78%
EPS Q2Q%-4.17%
EPS Next Y-8.98%
EPS Next 2Y-5.7%
EPS Next 3Y-2.78%
EPS Next 5Y7.91%
Revenue 1Y (TTM)-1.23%
Revenue growth 3Y1.35%
Revenue growth 5Y0.51%
Sales Q2Q%-1.35%
Revenue Next Year-0.1%
Revenue Next 2Y1.06%
Revenue Next 3Y0.85%
Revenue Next 5Y1.89%
EBIT growth 1Y1.21%
EBIT growth 3Y1.64%
EBIT growth 5Y-0.41%
EBIT Next Year91.5%
EBIT Next 3Y25.46%
EBIT Next 5Y15.47%
FCF growth 1Y39.2%
FCF growth 3Y-4.23%
FCF growth 5Y-6.84%
OCF growth 1Y-2.7%
OCF growth 3Y-3.43%
OCF growth 5Y-1.95%