BCE Earnings: Decent Quarter With Improvement Expected in Second Half

BCE’s second quarter looked similar to the past few in terms of subscriber growth and pricing and BCE’s positioning in the market. Postpaid phone subscriber growth remains historically strong, but clearly trails the success Rogers has been having in a hot market. On the other hand, BCE continues to take share in wireline with its fiber buildout. Margins remained under pressure, but should improve in the second half. In all, this quarter generally mirrors the trend we expect to continue long term, and we are maintaining our CAD 67 fair value estimate, leaving the stock materially undervalued, in our view.