North American Telecommunications

Discussion in 'Stock Market Forum' started by crimsonghost747, Jan 8, 2015.

  1. crimsonghost747

    crimsonghost747 Senior Investor

    Joined:
    Mar 2014
    Posts:
    1,722
    Likes Received:
    6
    Right, I'm in the following situation. I'm rebalancing my portfolio and the main idea is to shift focus from Europe into North America. One of the shares I'm ditching, or at least reducing my holdings in, is a telecommunications company. I still want to have a bit of this industry, so I'm looking for a North American alternative. Preferably one of the major players and has to have some sort of a decent dividend payout policy.

    AT&T is the first that comes to mind. Verizon also seems to be around the same valuation of P/E 10. Then I've been looking a bit more north and both Bell Canada and Rogers Communications seem interesting.

    I'll obviously dig deeper into all of the above before I make my choice(s) but any opinion about the companies mentioned above, or any other suggestions from the same industry, are more than welcome.
     
  2. Peninha

    Peninha Senior Investor

    Joined:
    Apr 2014
    Posts:
    602
    Likes Received:
    1
    Just out of curiosity crimsong, what telecommunications company from Europe are you ditching if you don't mind me asking?
     
  3. crimsonghost747

    crimsonghost747 Senior Investor

    Joined:
    Mar 2014
    Posts:
    1,722
    Likes Received:
    6
    TeliaSonera from Sweden. I haven't decided if I will sell everything or keep a small stake in the company, but I'm leaning towards getting rid of the whole thing.
     
  4. Gelsemium

    Gelsemium Senior Investor

    Joined:
    Apr 2014
    Posts:
    937
    Likes Received:
    2
    Some telecommunications companies have been taking a blow from what I've seen. In my country PT just crashed and the deal with the Brazilian Oi didn't seem to help as well. A big mess.
     
  5. Onionman

    Onionman Senior Investor

    Joined:
    Dec 2014
    Posts:
    394
    Likes Received:
    1
    I haven't looked at the sector for a while but it's worth looking at the EV/EBITDA valuation (if it's easy to find) for comparisons. It's easier for cross border comparisons as it accounts for different accounting treatments of depreciation, and it's a better for factoring in cash flow. CenturyLink used to be a pretty good telecom name with a decent dividend, albeit it wasn't excessively covered by cash flow.
     
  6. tournique

    tournique Well-Known Member

    Joined:
    Jan 2015
    Posts:
    126
    Likes Received:
    0
    AT&T/Verizon are your safest bets. They are huge companies at the moment and they control the market. Also be careful of which FCC regulations might affect them so you invest smart.
     
  7. Gelsemium

    Gelsemium Senior Investor

    Joined:
    Apr 2014
    Posts:
    937
    Likes Received:
    2
    I agree with that tournique, they are safe bets, but at the same time is it an investment that will gain value over time?
     
  8. crimsonghost747

    crimsonghost747 Senior Investor

    Joined:
    Mar 2014
    Posts:
    1,722
    Likes Received:
    6
    After a morning of running through the quarterly reports and some key statistics I've chosen at&t and bell Canada as probable candidates. Still need to dig a bit deeper before I make the final decision.

    Other suggestions are Still welcome, it will probably be another week or two before I pull the trigger. (heading off to vacation right now!)
     
  9. JulianWilliams

    JulianWilliams Well-Known Member

    Joined:
    Jan 2015
    Posts:
    62
    Likes Received:
    1
    Telecom companies will get a lot of competitions in the future IMO from companies like Google that will probably be looking a bringing in wireless internet to everyone for a reduced cost, and people will use the internet to make calls rather than going through the phone companies.
     
  10. Peninha

    Peninha Senior Investor

    Joined:
    Apr 2014
    Posts:
    602
    Likes Received:
    1
    Yeah, they get competition but they merge as well that is why they are getting bigger and bigger in the direction of the monopolies. These are illegal right? :)
     

Share This Page