Telus (T) AI Stock Analysis

• Market Cap: $33.52B
• Dividend Yield: 7.05%
• Average Volume (3M): 3.27M
• Price to Earnings (P/E): 28.0
• Beta (1Y): 0.38
• Revenue Growth: 1.73%
• EPS Growth: 54.01%
• Country: CA
• Employees: 106,800
• Sector: Communication Services
• Sector Strength: 93
• Industry: Telecommunications Services
• EPS (TTM): 0.26
• Shares Outstanding: 1,514,159,700
• 10 Day Avg. Volume: 3,813,885
• 30 Day Avg. Volume: 3,271,434
• PEG Ratio: 1.57
• Price to Book (P/B): 2.14
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 22.48
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $22.47
• Price Target Upside: 1.20% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 68 Neutral
• Price Target: C$24.00 ▲(8.11%Upside)

Telus's overall score reflects a solid financial performance with strong profitability and cash flow management. The company is well-positioned for long-term growth due to strategic initiatives and positive corporate events. However, its high valuation, moderate technical indicators, and leverage caution impact the short-term outlook. Attractive dividend yield and strategic focus on Health and Agriculture sectors add to the stock's appeal.

Positive Factors

Dividend Growth

TELUS extended its dividend growth program and is targeting 3-8% dividend increases from 2026 to 2028.

Health Segment Performance

TELUS Health segment and PE investment signal positive growth momentum and longer-term monetization opportunities.

Stock Performance

TELUS’ stock is up 14% year-to-date, reflective of strong execution despite the challenging conditions, and ahead of its larger peers.

Negative Factors

Dividend Sustainability

There is skepticism on the sustainability of TELUS’ dividend growth profile with the payout ratio still above 100%.

Network Revenue

Network revenue decreased reflecting slowed mobile loading and weak ARPU.

Wireless Service Revenue

Wireless remains the main challenge with service revenue growth remaining in negative territory.

Telus Business Overview & Revenue Model

Company Description

TELUS Corporation, together with its subsidiaries, provides a range of telecommunications and information technology products and services in Canada. It operates through Technology Solutions and Digitally-Led Customer Experiences segments. The Technology Solutions segment offers a range of telecommunications products and services; network revenue; mobile technologies equipment sale; data revenues, such as internet protocol; television; hosting, managed information technology, and cloud-based services; software, data management, and data analytics-driven smart food-chain technologies; home and business security; healthcare software and technology solutions; and voice and other telecommunications services. The Digitally-Led Customer Experiences segment provides digital customer experience and digital-enablement transformation solutions, including artificial intelligence and content management solutions. It has 16.9 million subscriber connections, which include 9.3 million mobile phone subscribers; 2.1 million connected device subscribers; 2.3 million internet subscribers; 1.1 million residential voice subscribers; 1.3 million TV subscribers; and 804,000 security subscribers. The company was formerly known as TELUS Communications Inc. and changed its name to TELUS Corporation in February 2005. TELUS Corporation was incorporated in 1998 and is headquartered in Vancouver, Canada.

How the Company Makes Money

Telus makes money through a variety of revenue streams primarily focused on telecommunications services. Its key revenue streams include mobile network services, where the company earns revenue from providing voice and data services to individual and business customers. This includes postpaid and prepaid plans, as well as additional services like roaming and equipment sales. Wireline services also contribute significantly, with Telus offering internet, television, and home phone services. Telus Health is another area of growth, generating revenue through digital healthcare solutions and technology services for healthcare providers and patients. The company also benefits from strategic partnerships and collaborations, which can enhance service offerings and customer reach.

Telus Financial Statement Overview

Summary

Telus demonstrates strong profitability and cash flow management, with effective cost control and operational efficiency. However, moderate revenue growth and a relatively high debt-to-equity ratio suggest caution in financial leverage. The company maintains a stable financial footing with opportunities for enhancing equity contributions.

Income Statement

The TTM (Trailing-Twelve-Months) gross profit margin is strong at 50.7%, indicating healthy cost management. The net profit margin improved to 5.85% in TTM, showing profitability enhancement. Revenue growth is modest at 0.75% from the previous year, reflecting stable market presence. EBIT and EBITDA margins are solid at 14.7% and 33.9% respectively, demonstrating efficient operational management despite slight margin compression compared to the previous year.

Balance Sheet

The debt-to-equity ratio stands at 1.92, indicating a moderate leverage level, which is typical for the telecom industry but poses some financial risk. ROE improved to 7.6%, reflecting better profitability on shareholders' equity. The equity ratio of 26.9% suggests a balanced capital structure, though with room for improvement in equity financing.

Cash Flow

Free cash flow saw a 1.85% growth, signaling controlled capital expenditure and stable cash generation. The operating cash flow to net income ratio is robust at 4.2, indicating strong cash generation relative to earnings. The free cash flow to net income ratio is 1.25, showing effective cash conversion from profits.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
20.29B	20.14B	20.00B	18.29B	16.84B	15.34B
	Gross Profit
10.29B	12.50B	12.47B	11.19B	10.14B	9.07B
	EBIT
2.98B	2.80B	2.36B	2.95B	3.07B	2.48B
	EBITDA
6.87B	6.68B	6.31B	6.94B	5.90B	5.63B
	Net Income Common Stockholders
1.19B	993.00M	841.00M	1.61B	1.66B	1.21B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.01B	869.00M	864.00M	974.00M	723.00M	848.00M
	Total Assets
57.98B	58.02B	56.14B	54.05B	47.99B	43.33B
	Total Debt
30.05B	29.78B	27.45B	25.14B	20.97B	20.39B
	Net Debt
30.05B	29.78B	26.59B	24.17B	20.24B	19.54B
	Total Liabilities
41.20B	41.23B	38.83B	36.39B	31.93B	30.73B
	Stockholders Equity
15.61B	15.62B	16.11B	16.57B	15.12B	12.07B
Cash Flow		Free Cash Flow
1.49B	1.46B	1.29B	1.16B	-928.00M	1.75B
	Operating Cash Flow
4.97B	4.85B	4.50B	4.81B	4.39B	4.57B
	Investing Cash Flow
-3.31B	-3.70B	-4.75B	-5.41B	-5.47B	-6.17B
	Financing Cash Flow
-2.81B	-1.14B	139.00M	848.00M	953.00M	1.90B

Telus Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.20
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:T, the sentiment is Positive. The current price of 22.2 is above the 20-day moving average (MA) of 21.56, above the 50-day MA of 20.96, and above the 200-day MA of 20.96, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 61.16 is Neutral, neither overbought nor oversold. The STOCH value of 71.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:T.

Telus Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
T	68 Neutral	$33.52B	27.97	7.51%	7.05%	1.73%	54.01%
Sector *	61 Neutral	$14.08B	5.95	-4.18%	3.68%	2.79%	-36.29%
BCE		$19.82B	78.40	2.83%	13.32%	―	―
RCI		$14.36B	11.01	16.65%	5.51%	―	―
QBR.A	79 Outperform	C$8.72B	11.54	37.46%	3.49%	-1.11%	8.17%
RCI.A	75 Outperform	C$19.72B	12.14	16.56%	5.00%	1.50%	193.09%
QBCRF		$6.35B	11.54	37.69%	3.48%	―	―

Telus Corporate Events

TELUS Launches $1.6 Billion Junior Subordinated Note Offering

TELUS has announced the pricing of $1.6 billion in fixed-to-fixed rate junior subordinated notes through a syndicate of agents. These notes, issued in two series with a 30.25-year maturity, are intended to help the company repay outstanding debts and support general corporate purposes. The Series CAR notes have an initial yield of 6.25% and the Series CAS notes have an initial yield of 6.75%, with both series having mechanisms to reset interest rates every five years. The issuance of these notes is expected to enhance TELUS’s financial flexibility and strengthen its market position.

TELUS Considers Strategic Sale of Wireless Tower Stake to Boost Financial Flexibility

TELUS is exploring the sale of a minority stake in its wireless tower infrastructure to enhance network operations and strengthen its balance sheet. This move aims to provide financial flexibility, allowing TELUS to pay down debt and achieve a leverage target by 2027, while maintaining its commitment to sustainable growth and stakeholder value.