A 5G Stock With 5.9% Dividend Yield: Buy Alert!

Stocks of BCE Inc. (TSX:BCE), the parent firm of Bell Canada, caught the attention of the equity market enthusiasts after it released its first-quarter 2021 earnings report last week. BCE stock also trended after it announced a grant of C$ 750,000 in funding to six organizations providing access to mental healthcare to people from BIPOC (Black, Indigenous and People of Colour) communities.

The company had launched the Bell Let's Talk initiative in 2011 to combat stigma around mental illness. Mary Deacon, Chair of Bell Let's Talk, said that due to the impact of COVID-19 and racial injustice, there has been a growing demand for mental health services.

Let's Explore Recent Financial Performance Of Bell Canada (TSX:BCE)

In the first quarter of this year, the communication services company clocked a revenue of C$ 5.7 billion, which represented an increase of 1.2 per cent year-over-year (YoY). The cash flows from operating activities increased by 37.3 per cent to C$ 1,992 million in the same period.

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The company posted an increased adjusted EBITDA to C$ 2,429 million in Q1 2021, up by 0.5 per cent in comparison from Q1 2020. The free cash flow increased by 53.8 per cent to C$ 940 million in the same period.

The company's net earnings were C$ 687 million in the first quarter of 2021.

Here's How BCE Stock Performed

The stock grew by about two per cent in a week and based on a five-day average, over 2 million BCE shares were traded on the TSX. At market close on Friday, May 7, the scrips were priced at C$ 59.11 apiece, a little less than its 52-week high of C$ 60.14 on June 8, 2020.

The S&P TSX Integrated Telecommunication Services (Sub Industry) Index plunged by about four per cent in a year and it was outperformed by BCE stock as it grew by 4.6 per cent. Its year-to-date (YTD) growth stands at 8.6 per cent.

With a current dividend yield of 5.9 per cent, Bell Canada distributes a quarterly dividend of C$ 0.875. The company holds a debt-to-equity (D/E) ratio of 1.6 and its return on equity is 13.3 per cent, as per TMX.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.


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