Canadian telecom BCE ( NYSE: BCE ) is down 0.9% Monday, while major North American peers are fractionally higher, after TD Securities downgraded the stock to Hold.
That's due to valuation, as BCE stock has risen 10% since TD upgraded it to Buy on Oct. 13.
That's brought the yield back down below 6% and TD wants to look for a lower entry point.
"We continue to believe that BCE is a low-risk name that is supported by long-life infrastructure," analyst Vince Valentini said.
The company's fiber build target (10M locations) should be 80% complete as of the end of 2022, and it can rely on its 5G wireless network and enterprise relationships ahead, as well as providing a good dividend (which should bump by 5% on Feb. 2), he said.
But the company also faces hurdles in the form of "higher for longer interest rates, cyclical headwinds in some BCE segments, and tougher wireless competition."
TD's target price of C$65 indicates a 12-month return of 10%.
Wall Street analysts consider the stock a Buy on average , while Seeking Alpha contributors rate it a Hold . Seeking Alpha's Quant Ratings also have BCE as a Hold .
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BCE stock dips as TD cuts to Hold on valuation concerns