Canadian telecom giant Bell Canada (TSE:BCE) (NYSE:BCE) made a huge play recently as it closed the purchase of Outfront Media. A play too big for Canadian regulators, in fact, as they stepped in to demand Bell Canada sell off 669 outdoor advertising displays as a condition of making the purchase. The move prompted a slight slip in Bell’s stock price, as shares were down fractionally in Tuesday morning’s trading.
Reports noted that Bell Canada picked up Outfront Media for $410 million, and with that deal came the 9,325 advertising displays Outfront Media—eventually Outedge Media Canada—owned. The regulators found that the move was “likely to substantially lessen competition” in several areas, including Sherbrooke, Quebec City, and both the Greater Toronto and Greater Montreal areas.
The regulators noted that Bell and Outfront were actually brisk competitors, so Bell’s purchase of Outfront removed a hefty dose of competition from the market. The sale of the 669 billboards, meanwhile, will help restore balance.
Augmenting Its Presence Elsewhere
But Bell Canada isn’t just stepping up its outdoor media presence. It’s also rolling out new bandwidth in the 3.8 GHz spectrum in Toronto and is putting more of the 3.5 GHz spectrum to use in expanding its 5G offerings. Given that Bell Canada recently dropped $518 million to pick up 939 3.8 GHz licenses, it was a safe bet it would do something with those before too long had passed.
And, just to round things out, it recently announced its planned slate of original programming, bringing back a huge amount of old content while adding a total of 36 new English and French programs.
Is Bell Canada Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BCE stock based on three Buys and seven Holds assigned in the past three months, as indicated by the graphic below. After an 18.84% loss in its share price over the past year, the average BCE price target of C$50.49 per share implies 8.54% upside potential.
