Shopping for a dividend inventory when it’s down can really feel slightly backwards, which is precisely why it typically works. The yield rises because the share value falls, so that you receives a commission more money move for each greenback you place in. If the enterprise stays stable, that increased yield can juice long-term returns, particularly in a Tax-Free Financial savings Account (TFSA) the place you possibly can reinvest dividends with out tax friction. The catch is easy: a falling value can even sign actual issues, so the job is to separate a briefly disliked inventory from a completely broken one. So, the place does this telecom sit?
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TELUS (TSX:T) is one among Canada’s massive telecoms, making its cash by promoting wi-fi and web companies, plus overseeing a rising well being and digital companies footprint. It tends to enchantment to traders who need regular service income, an enormous buyer base, and a dividend that exhibits up like clockwork.
During the last 12 months, TELUS inventory handled two challenges that may weigh on the share value even when operations look wonderful. First, traders have remained choosy about something with heavy capital spending and significant debt, as increased rates of interest make leverage really feel much less comfy. Second, the Canadian wi-fi market has stayed intensely aggressive, which may stress pricing and sluggish the tempo of common income per person enhancements.
The extra upbeat information got here from the corporate’s personal updates, which leaned laborious on buyer progress, value self-discipline, and a deal with money move. In its fourth-quarter and full-year 2025 launch, TELUS inventory highlighted sturdy internet additions, together with 377,000 whole cell and glued buyer additions in This autumn, and it framed that demand as proof that its bundled companies nonetheless resonate. The corporate additionally set 2026 targets that time to a steadier 12 months, moderately than a white-knuckle one.
Earnings help
In This autumn 2025, TELUS inventory reported consolidated working revenues and different revenue of $5.3 billion, barely decrease than the prior 12 months’s $5.4 billion, however it stated service income grew 1%, and the decline got here from decrease gear income and different revenue. Briefly, it bought fewer units, however the core subscription engine saved shifting.
For the complete 12 months, TELUS inventory pointed to a report $2.2 billion in consolidated free money move, up 11% versus the prior 12 months, and money from operations of $4.9 billion. That free money move line is the one dividend traders ought to circle, because it speaks to how comfortably the corporate can fund payouts whereas nonetheless investing within the community. TELUS inventory additionally flagged internet debt to adjusted earnings earlier than curiosity, taxes, depreciation and amortization (EBITDA) at 3.4 instances on the finish of 2025, setting a goal to maintain deleveraging over the subsequent couple of years.
Trying forward, TELUS inventory laid out 2026 targets that learn like a “stabilize and develop” plan. It goals for consolidated service revenues and adjusted EBITDA progress of two% to 4%, capital expenditures of about $2.3 billion, and consolidated free money move of about $2.5 billion, which it described as roughly 10% progress. If it hits these numbers, the narrative can shift from “heavy spender” to “cash-flow compounding machine,” which tends to assist valuation. In the meantime, it nonetheless provides a dividend yield of 9% whereas buying and selling at 26 instances earnings, which may usher in ample revenue from a $15,000 funding.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| T | $18.53 | 809 | $1.67 | $1,351.03 | Quarterly | $14,991.77 |
Backside line
So, may TELUS inventory be a purchase for others whereas it’s down? It may, if somebody needs a basic Canadian dividend title, can deal with share-price boredom, and cares extra about money move than bragging rights. The bull case rests on bettering money technology, clear deleveraging objectives, and the straightforward proven fact that Canadians preserve paying their cellphone and web payments. The bear case can be actual. The payout seems to be stretched on easy screens, competitors can mess with pricing, and debt stays a constraint till leverage retains trending down.