In Canada Telecom, We Like the Big Three Most, but All Are Good; Let the Market Determine Your Pick

We generally think all the major Canadian telecom companies have strong businesses and are worthy of investment at the right price. We favor the businesses of the three biggest wireless providers—Rogers, BCE, and Telus—the most. We see them as low-uncertainty stocks with stable businesses and narrow moats. Recently, the stock market has favored stability, to the benefit of the Big Three. BCE and Telus look fairly valued relative to our CAD 67 and CAD 32 fair value estimates, respectively. Rogers has only recently dropped materially below our fair value estimate due to uncertainty surrounding its Shaw acquisition, which won’t materially change our CAD 70 fair value estimate regardless of how the deal plays out. The selloff makes Rogers’ stock attractive currently, in our view.