Benjamin Swinburne, an analyst from Morgan Stanley, maintained the Hold rating on Telus. The associated price target was lowered to C$20.00.
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Benjamin Swinburne has given his Hold rating due to a combination of factors impacting Telus’s market position. One of the primary considerations is the lack of growth in Canadian mobile service revenues, which contrasts with the rising valuation levels compared to most US telecommunications companies. This stagnation in revenue growth suggests limited upside potential in the near term, prompting a cautious approach.
Additionally, the competitive landscape in the telecommunications sector is intensifying, which could further pressure Telus’s market share and profitability. While the US wireless market shows more promise with consolidation and growth opportunities, the Canadian market, where Telus primarily operates, does not exhibit the same dynamics. These factors collectively contribute to the decision to maintain a Hold rating, reflecting a balanced view of potential risks and rewards.
In another report released yesterday, BMO Capital also downgraded the stock to a Hold with a C$19.00 price target.
TU’s price has also changed moderately for the past six months – from C$21.990 to C$18.300, which is a -16.78% drop .