Should investors hang up on BCE shares before election day?

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Justin Trudeau has made the relatively high cost of Canadian of cell phone data an election issue by promising to slash subscriber costs by up to 25%. Do insiders at BCE sense riskier times ahead for the domestic cell phone industry as we approach election day on October 21st? INK Research tackles that question in the September 25th Morning Report and Ultra Money video. Below is a free version of the video that was distributed earlier on INK Ultra Money.

INK trading day morning reports and videos are available through INKResearch.com or Canadian Insider Club Ultra memberships. INK is subscriber supported and does not accept payment for stock coverage.

Script (check against delivery):

        BCE stock has been setting new highs

        but so has insider selling.
        Over the past 90 days,
        insiders have sold $72 million worth
        of stock in the public market,
        a four-year high.
        The recent selling came before
        the news last weekend that if reelected,
        Justin Trudeau would target
        a 25% reduction in
        cell phone bills for
        Canadians over four years.
        Should
        a minority government situation develop,
        there is a risk that
        politicians of all stripes
        may jump on the band wagaon
        to cut cell phone bills.
        BCE has enjoyed annual EPS growth
        over the past 5 years of 4%,
        but that is below the Telecom
        sector average of 4.8%.
        Moreover, the growth took place even as
        BCE enjoys strong market power
        in the wireless industry.
        Together with Rogers and Telus,
        it is in a threesome that accounts for 90% of
        wireless Canadian subscribers according
        to the latest industry data.
        While the chances may be small that
        politicans move to shake
        up the wireless industry,
        the risk may require an increase in
        the BCE risk premium and
        its associated dividend yield
        which is curently 4.9%.
        Such a scenario has the potential lead
        to a period of
        prolonged share price underperformance.
        The best outcome for BCE shareholders
        at this point would likely be
        a majority government of any that feels
        little urgency tinker with
        the structure of the wireless industry.
        Our report which is not
        a recommendation to buy or sell
        securities is available through INKResearch.com   
       (https://www.inkresearch.com/)
        or the Canadian Insider Club     
       ( https://www.canadianinsider.com/).
        Good luck, friends, and thanks for listening!
 

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