AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
Source: Blue Planet Studio, Shutterstock
While presenting the federal budget 2021 on Monday, April 19, Finance Minister Chrystia Freeland announced C$ 1 billion in funds for the development of broadband connectivity for rural and remote communities.
About a month ago, Rogers Communications (TSX:RCI.B) and Shaw Communications (TSX:SJR.B) had also pitched their merger proposal with similar plans – to invest billions in the expansion of its broadband network to rural regions as a combined entity.
Both the telecom giants had stated that the merged company would spend C$ 6.5 billion to build a 5G infrastructure in the western area of the country.
Freeland’s budgetary investment, however, will be impacting other major telecom payers as well, including BCE Inc (TSX:BCE.B) and Telus Corporation (TSX:T).
Earlier, Telecom Minister Francois-Philippe Champagne had stated that the federal government’s assessment would focus on the aspects of “affordability, competition and innovation” in the sector. Accordingly, the fund distribution would take place to maintain fair competition among telecom companies.
Let us glance at the top four telecom stocks on the back of this announcement:
Stocks of Rogers Communications Inc (TSX:RCI.B) are up 4.08 per cent this year, surpassing the S&P/TSX Wireless Telecommunication Services (Industry) Index, which is trading relatively flat. It is currently trading at C$ 61.68 per share. Bay Street analysts have recently upgraded its rating. Thus, the stock increased by 1.8 per cent despite the bear market on Monday.
Meanwhile, Shaw Communications Inc (TSX:SJR.B) has outperformed its peers to gain 55.86 per cent year-to-date (YTD) in the wake of its merger deal with Rogers. Its current price stands at C$ 34.82 apiece against the proposed acquisition price of C$ 40.5 per common share, representing more than 14 per cent of the margin.
Image Source: Pixabay.com
Stocks of BCE Inc (TSX:BCE.B) have surged by almost seven per cent YTD, beating Rogers’ share in the same period. It traded nearly flat on April 19, with a marginal gain of 0.09 per cent to C$ 58.16 apiece.
Shares of Telus Corporation (TSX:T), on the other hand, decreased by 1.11 per cent to C$ 25.77 apiece on Monday. It is up 2.22 per cent YTD, slightly behind its competitors.
