BCE Reports Decent Q4, but Offers Lukewarm 2023 Guidance

BCE had a good fourth quarter, as it continued to take share in wireline and posted great wireless results, though it again slightly lagged Rogers in wireless phone customer additions. However, gains in wireline market share are not yet translating to wireline sales growth, and BCE isn’t operating as efficiently as Rogers, as judged by margins in both 2022 results and the firms’ respective 2023 outlooks. We are maintaining our CAD 67 fair value estimate for BCE, leaving the stock moderately undervalued. We don’t think the stock is overly exciting at present, but further weakness would provide an excellent buying opportunity in our view.