TELUS CORP (TU)
CA87971M1032 - Common Stock
Taking everything into account, TU scores 3 out of 10 in our fundamental rating. TU was compared to 36 industry peers in the Diversified Telecommunication Services industry. TU has a medium profitability rating, but doesn't score so well on its financial health evaluation. TU is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
TU had positive earnings in the past year.
In the past year TU had a positive cash flow from operations.
Each year in the past 5 years TU has been profitable.
In the past 5 years TU always reported a positive cash flow from operatings.
1.2 Ratios
TU has a Return On Assets of 1.50%. This is in the better half of the industry: TU outperforms 61.11% of its industry peers.
TU has a Return On Equity of 5.22%. This is in the better half of the industry: TU outperforms 61.11% of its industry peers.
With a decent Return On Invested Capital value of 4.90%, TU is doing good in the industry, outperforming 66.67% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TU is in line with the industry average of 5.85%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.5% | ||
| ROE | 5.22% | ||
| ROIC | 4.9% |
ROA(3y)2.64%
ROA(5y)3.06%
ROE(3y)8.64%
ROE(5y)10.5%
ROIC(3y)5.49%
ROIC(5y)5.87%
1.3 Margins
TU's Profit Margin of 4.20% is fine compared to the rest of the industry. TU outperforms 66.67% of its industry peers.
In the last couple of years the Profit Margin of TU has declined.
TU has a better Operating Margin (14.93%) than 75.00% of its industry peers.
In the last couple of years the Operating Margin of TU has declined.
TU has a better Gross Margin (63.27%) than 72.22% of its industry peers.
TU's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.93% | ||
| PM (TTM) | 4.2% | ||
| GM | 63.27% |
OM growth 3Y-5.65%
OM growth 5Y-5.08%
PM growth 3Y-18.85%
PM growth 5Y-18.02%
GM growth 3Y1.54%
GM growth 5Y2.91%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TU is destroying value.
TU has more shares outstanding than it did 1 year ago.
TU has more shares outstanding than it did 5 years ago.
TU has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.03, we must say that TU is in the distress zone and has some risk of bankruptcy.
With a decent Altman-Z score value of 1.03, TU is doing good in the industry, outperforming 77.78% of the companies in the same industry.
The Debt to FCF ratio of TU is 31.66, which is on the high side as it means it would take TU, 31.66 years of fcf income to pay off all of its debts.
TU's Debt to FCF ratio of 31.66 is on the low side compared to the rest of the industry. TU is outperformed by 63.89% of its industry peers.
TU has a Debt/Equity ratio of 1.46. This is a high value indicating a heavy dependency on external financing.
TU has a Debt to Equity ratio of 1.46. This is in the lower half of the industry: TU underperforms 63.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.46 | ||
| Debt/FCF | 31.66 | ||
| Altman-Z | 1.03 |
ROIC/WACC0.81
WACC6.05%
2.3 Liquidity
A Current Ratio of 0.67 indicates that TU may have some problems paying its short term obligations.
TU has a Current ratio of 0.67. This is amonst the worse of the industry: TU underperforms 88.89% of its industry peers.
A Quick Ratio of 0.62 indicates that TU may have some problems paying its short term obligations.
The Quick ratio of TU (0.62) is worse than 88.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.62 |
3. Growth
3.1 Past
The earnings per share for TU have decreased strongly by -20.17% in the last year.
The Earnings Per Share has been decreasing by -7.85% on average over the past years.
The Revenue has grown by 9.36% in the past year. This is quite good.
The Revenue has been growing slightly by 7.25% on average over the past years.
EPS 1Y (TTM)-20.17%
EPS 3Y-3.89%
EPS 5Y-7.85%
EPS growth Q2Q4.35%
Revenue 1Y (TTM)9.36%
Revenue growth 3Y9.25%
Revenue growth 5Y7.25%
Revenue growth Q2Q2.65%
3.2 Future
Based on estimates for the next years, TU will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.86% on average per year.
Based on estimates for the next years, TU will show a small growth in Revenue. The Revenue will grow by 4.56% on average per year.
EPS Next Y10.78%
EPS Next 2Y13.49%
EPS Next 3Y13.82%
EPS Next 5Y11.86%
Revenue Next Year2.64%
Revenue Next 2Y3.35%
Revenue Next 3Y4.04%
Revenue Next 5Y4.56%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.51, which indicates a rather expensive current valuation of TU.
Based on the Price/Earnings ratio, TU is valued a bit cheaper than 61.11% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.91, TU is valued at the same level.
A Price/Forward Earnings ratio of 21.32 indicates a rather expensive valuation of TU.
TU's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 20.51. TU is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.51 | ||
| Fwd PE | 21.32 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as TU.
The rest of the industry has a similar Price/Free Cash Flow ratio as TU.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.98 | ||
| EV/EBITDA | 8.44 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
TU has a very decent profitability rating, which may justify a higher PE ratio.
TU's earnings are expected to grow with 13.82% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.18
PEG (5Y)N/A
EPS Next 2Y13.49%
EPS Next 3Y13.82%
5. Dividend
5.1 Amount
TU has a Yearly Dividend Yield of 6.70%, which is a nice return.
TU's Dividend Yield is rather good when compared to the industry average which is at 5.12. TU pays more dividend than 91.67% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, TU pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.7% |
5.2 History
The dividend of TU decreases each year by -1.08%.
TU has paid a dividend for at least 10 years, which is a reliable track record.
As TU did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)-1.08%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
156.36% of the earnings are spent on dividend by TU. This is not a sustainable payout ratio.
DP156.36%
EPS Next 2Y13.49%
EPS Next 3Y13.82%
TELUS CORP
NYSE:TU (5/16/2024, 9:21:36 AM)
16.46
-0.05 (-0.3%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap24.16B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.7% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.51 | ||
| Fwd PE | 21.32 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.18
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.5% | ||
| ROE | 5.22% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 14.93% | ||
| PM (TTM) | 4.2% | ||
| GM | 63.27% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.46 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.62 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-20.17%
EPS 3Y-3.89%
EPS 5Y
EPS growth Q2Q
EPS Next Y10.78%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)9.36%
Revenue growth 3Y9.25%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y