BCE Inc. (BCE:CA) (BCE)
National Bank Financial has maintained its “Outperform” rating for BCE Inc., adjusting its 12-month price target to CAD 35 from CAD 36. This revision reflects a cautious outlook amid ongoing challenges in the telecommunications sector.
Analyst Adam Shine’s updated forecast for BCE’s FY2025 earnings per share is CAD 2.70, slightly down from the previous estimate of CAD 2.71. This adjustment aligns with broader concerns over the company’s financial health, including high leverage and dividend sustainability. Despite these challenges, BCE continues to offer a substantial dividend yield, which remains a key attraction for income-focused.
Stock Forecast & Analysis
According to the stock forecast from 12 analysts, the average 12-month target price for BCE Inc. is CAD 34.94. This represents a potential upside of approximately 17% from its most recent closing price of CAD 29.87. However, the average analyst rating is a “Hold,” indicating a neutral stance on the stock. Analysts see limited near-term catalysts for significant growth, suggesting that investors should not expect major upside in the short term.
Stock Target Advisor’s independent fundamental analysis paints a more negative picture, rating BCE Inc. as “Bearish.” This rating is based on three positive signals and eleven negative signals. The bearish assessment reflects concerns about the company’s financial fundamentals, which likely include high levels of debt, weak earnings growth, and pressure on revenue. There are also likely worries about BCE’s ability to sustain its dividend amid high capital expenditure and broader challenges in the Canadian telecom sector.
Despite some recent signs of stabilization, BCE’s share performance over the past year has been notably weak. The stock has gained 0.54% over the past week and 1.12% over the past month, but these small increases follow a steep decline of 36.78% over the past year. This long-term drop has been driven by factors such as rising interest rates, which reduce the appeal of dividend-paying stocks, concerns about the sustainability of BCE’s dividend, and regulatory and competitive pressures affecting the Canadian telecom industry.
In summary, while BCE Inc. still offers an attractive dividend and maintains its role as a defensive telecom stock, analysts and technical models remain cautious. With a “Hold” rating consensus and bearish sentiment from algorithmic analysis, the company may struggle to regain investor confidence until it demonstrates more stable earnings, improved growth prospects, or clarity around its long-term capital strategy.
STA Research (StockTargetAdvisor.com) is a independent Investment Research company that specializes in stock forecasting and analysis with integrated AI, based on our platform stocktargetadvisor.com, EST 2007.
