Telus Corp (T.TO)

For his more conservative clients seeking income, he prefers Bell Canada (BCE-T), but for those looking for more growth, Telus offers the best growth. Everybody has to own at least one telco, and maybe 2. Every time the CRTC does something, somehow the majors managed to make more money than they did before. It is like magic.

A lot of their business is coming from Western Canada, so the stock has fallen off quite a bit. He would probably look at this again at some point, but technically it is still below the 200 day moving average. He would stay away until there are more signs of strength. Needs to get above the $41-$42 level before he would dip into it. (See Top Picks.)

Has never owned this because it was too expensive. With this you have to deal with the Alberta issue. He prefers BCE (BCE-T) which has done a great job with fibre and with content.

He likes the name. All the Telcos in Canada are a buy. Foreigners are not going to come into the space. It sold off because of what happened in Alberta. Smart phone adoption in Canada is a lot less than in the US. Great dividend.

(Market Call Minute.) At $40 or lower, this is a great buy.

Model is $31.61. If it got down to $29.50 he would be pounding the table.

Under pressure because of the new entrant into the phone business. They have been under a lot of pressure. He prefers RCI.B-T because of ties to other areas, but this whole sector has been under pressure. BCE-T seems to be doing better.

(His top picks are dividend growers.) When a company raises its dividend, it is signalling to investors that it thinks the year ahead is going to be good. This one has been a wonderful dividend grower with many, many years of dividend growth. 2 dividend increases last year added up to about 10%. The stock has been hurt by the sentiment of its exposure to the energy intensive provinces. Dividend yield of 4.56%.

The cheapest of the big 3. It recently set back to excellent support at about 2.5X Book. For this stock, that is quite cheap. Has nice upside potential and a 4.7% dividend yield.

An incredibly well run company that have done a terrific job over the last decade. A big part of their problem now is the oil sector and Shaw. Shaw will be quite aggressive against Telus (T-T). He thinks you can do better elsewhere, e.g. with Rogers (RCI.B-T).

Has fallen off a little in the last couple of months due to its exposure in the West as well as the Shaw (SJR.B-T) Wind Mobile deal. Likes their dividend yield of 4.7%, and that they are determined to grow that dividend yield by 8%-9% per year over the next few years. The stock has come down to the 15X forward earnings level with a 10% growth rate, which is not too bad.

Doesn’t own any names in the telco space. She got out a few years ago because of regulatory and competition concerns. That has lifted a bit, but this company took another drop when Shaw (SJR.B-T) announced they were buying Wind Mobile a few weeks ago. She is not inclined to re-enter the sector right now. Shaw will be a stronger competitor, and Telus has much more exposure to Western Canada, where there could be much weaker wireless growth.

There are 4 possible players now. T-T was affected more than the others. The numbers look cheap. He purchased just a month or so ago when he thought it bottomed. It will be fine long term. There is insider buying. This is a good entry point.

People are worried about their slowdowns in the west. They are growing their dividend. He is comfortable owning this right now. You closed the door on incoming competition with Shaw.

The sector is okay. You can’t go wrong in the group. The uptrend is intact. He sees no reason to sell. You aren’t going to wake up to a horror story. You might want to look at MBT-T also, as they finally got rid of Allstream.