I own both stocks.

One reason telecom yields remain near historically high levels is due to rising competition within the wireless market and regulatory challenges.

Additionally, BCE’s high debt levels add to concerns over its ability to raise its quarterly distribution.

Ms.

Price estimates that telecom revenue from its customers, on average, will decline by low single digits over the course of 2024, suggesting that competitive pressures won’t let up this year.

She expects that the regulatory headwinds will abate after the Canadian Radio-television and Telecommunications Commission delivers its next rates decision on third-party internet access – what competitors pay to access the networks of the big telecom companies – before the end of the year.

More importantly, she believes that investors will move into high-yielding stocks as bond yields decline.

Over the past 20 years, when the yield on the 10-year U.

S.

Treasury bond has declined by at least three-quarters of a percentage point, telecom share prices have gained an average of 13.

3 percent.

Excluding the market-wide downturn of 2007-08 during the financial crisis, the average gain is more than 20 percent.

“We expect the telcos, BCE and Telus, to benefit more from falling interest rates than the cable companies given their higher dividend yields,” Ms.

Price said in her note.