Telus Corp (T.TO)

(Past Top Pick Nov. 3, 2017, Up 1%) Still likes it, its dividend and dividend growth. Likes its defensive qualities. He sees 10% EPS growth. Telus will be fine over the next few years. Also look at BCE which has gotten a lot cheaper.

A pure play wireless name. We're doing more and more on our smartphones, which means data charges are rising. He sees continued growth. He's long held Telus. Telus is at the end of a capex cycle, spending money on 4G networks. So, there'll be money leftover to pay back shareholders through dividend growth.

T-T vs. RCI.B-T vs. BCE-T. Nobody knows which one will do better. The best way to play it in the utility space is ZWU-T, which gives exposure to Telco's, pipelines and utilities. These things are interest rate sensitive so you will not get much capital gains and you have to be cautious.

(A Top Pick Aug 15/17, Up 13%) If you compare how it has done to other telcos, it is pretty impressive. They are focused on the wireless space which is where the growth is coming from. He continues to buy it.

It is a pure play. One of the best CEOs in Canada. They have not diversified into media. They have healthcare that is growing aggressively. They are past their peak cap-X. The dividend should continue to grow.

He likes it. Pricey relative to its peers. Telco’s are yield sensitive. He expects solid growth. Dividend is safe. Balance sheet is stable. There is still lots of growth in Canada in wireless. He prefers other names in the space that offers better value.

This stock ranks well in the 700 stocks in his dividend-stock database, but its near-term cash flow is negative, in comparison to 3-year and 5-year cash flow growth which have been OK. In contrast, Rogers ranks as an OK-to-buy stock in his system.

Stock is up 2.5% YTD. His colleague argues that given their capex peak in mid-2017 followed by absorbing the MTS (Manitoba Telecom) subscriber base, their their free cash flow should be strong in the future. Telus is the strongest of the Canadian telcos with great numbers. It looks good going forward. Their cash flow will help them weather rising interest rates.

The whole sector has been under pressure. Nothing wrong with Telus per se as it rolls out high-speed products. You can own this for the long-term. He sees no regulatory risk. The only risk is if Freedom Mobile gets aggressive and how likely is that?

Telecoms are pretty vulnerable here. Pricey relative to its group. They surprised to the upside on guidance on Q4. They have a network advantage. He is modeling 17% earnings growth, 7% dividend growth and a payout ratio that support that dividend. A name that had some capex issues in the last couple of years, but they had seen the inflection here.

Held up better than Rogers recently. Good dividend. Terrific Dividend growth. Run by one genius operators. One of the best CEOs in Canada. He loves the telcos. (Analysts’ price target is $51)

He is looking at a possible exit because cash flow is slowing. It has not fallen like other utilities. He does not see a great recovery in revenues. There is nothing wrong with the company.

Likely to post solid future growth longer-term. Currently, we have spiking bond yields, which impacts telco valuations. This one is at a level that is not cheap, trading at 17.5X 2018. However on Q3 they guided to lower CapX for the 1st time since 2010. That's a suggestion they have built most of their footprint. Also, they beat on new subscribers both wireless and wireline. He models them growing EPS at 15% for 2017-2019. With this pullback, because of the climb in bond yields, you can write a Put and oblige yourself to own it at $45, and get a nice little premium.