TELUS CORP (T.CA)
CA87971M1032 - Common Stock
We assign a fundamental rating of 4 out of 10 to T. T was compared to 29 industry peers in the Diversified Telecommunication Services industry. There are concerns on the financial health of T while its profitability can be described as average. T is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year T was profitable.
T had a positive operating cash flow in the past year.
Each year in the past 5 years T has been profitable.
In the past 5 years T always reported a positive cash flow from operatings.
1.2 Ratios
T's Return On Assets of 1.62% is amongst the best of the industry. T outperforms 89.66% of its industry peers.
Looking at the Return On Equity, with a value of 5.85%, T belongs to the top of the industry, outperforming 82.76% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 5.08%, T is doing worse than 86.21% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for T is in line with the industry average of 6.97%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.62% | ||
| ROE | 5.85% | ||
| ROIC | 5.08% |
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
T has a Profit Margin of 4.62%. This is amongst the best in the industry. T outperforms 86.21% of its industry peers.
T's Profit Margin has declined in the last couple of years.
The Operating Margin of T (16.24%) is worse than 89.66% of its industry peers.
In the last couple of years the Operating Margin of T has declined.
With a Gross Margin value of 63.01%, T is not doing good in the industry: 86.21% of the companies in the same industry are doing better.
T's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.24% | ||
| PM (TTM) | 4.62% | ||
| GM | 63.01% |
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 T is destroying value.
The number of shares outstanding for T has been increased compared to 1 year ago.
The number of shares outstanding for T has been increased compared to 5 years ago.
T has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.95, we must say that T is in the distress zone and has some risk of bankruptcy.
T has a Altman-Z score of 0.95. This is amongst the best in the industry. T outperforms 89.66% of its industry peers.
The Debt to FCF ratio of T is 30.67, which is on the high side as it means it would take T, 30.67 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of T (30.67) is worse than 86.21% of its industry peers.
T has a Debt/Equity ratio of 1.67. This is a high value indicating a heavy dependency on external financing.
T's Debt to Equity ratio of 1.67 is amongst the best of the industry. T outperforms 93.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | 30.67 | ||
| Altman-Z | 0.95 |
ROIC/WACC0.87
WACC5.82%
2.3 Liquidity
A Current Ratio of 0.69 indicates that T may have some problems paying its short term obligations.
The Current ratio of T (0.69) is better than 93.10% of its industry peers.
T has a Quick Ratio of 0.69. This is a bad value and indicates that T is not financially healthy enough and could expect problems in meeting its short term obligations.
T has a Quick ratio of 0.63. This is amongst the best in the industry. T outperforms 93.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.57% over the past year.
Measured over the past years, T shows a decrease in Earnings Per Share. The EPS has been decreasing by -7.85% on average per year.
The Revenue has been growing slightly by 0.46% in the past year.
T shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.25% yearly.
EPS 1Y (TTM)9.57%
EPS 3Y-3.89%
EPS 5Y-7.85%
EPS Q2Q%12%
Revenue 1Y (TTM)0.46%
Revenue growth 3Y9.25%
Revenue growth 5Y7.25%
Sales Q2Q%1.82%
3.2 Future
The Earnings Per Share is expected to grow by 19.02% on average over the next years. This is quite good.
The Revenue is expected to grow by 2.36% on average over the next years.
EPS Next Y8.29%
EPS Next 2Y6.83%
EPS Next 3Y9.56%
EPS Next 5Y19.02%
Revenue Next Year0.35%
Revenue Next 2Y1.57%
Revenue Next 3Y2.65%
Revenue Next 5Y2.36%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 18.89, which indicates a rather expensive current valuation of T.
Based on the Price/Earnings ratio, T is valued expensively inside the industry as 89.66% of the companies are valued cheaper.
T is valuated rather cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 17.95, the valuation of T can be described as rather expensive.
Based on the Price/Forward Earnings ratio, T is valued more expensive than 86.21% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.80. T is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.89 | ||
| Fwd PE | 17.95 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, T is valued more expensive than 89.66% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, T is valued expensively inside the industry as 86.21% of the companies are valued cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.96 | ||
| EV/EBITDA | 7.71 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)2.28
PEG (5Y)N/A
EPS Next 2Y6.83%
EPS Next 3Y9.56%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 8.13%, T is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 10.77, T is paying slightly less dividend.
T's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.13% |
5.2 History
The dividend of T decreases each year by -1.08%.
T has paid a dividend for at least 10 years, which is a reliable track record.
T has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-1.08%
Div Incr Years21
Div Non Decr Years22
5.3 Sustainability
T pays out 163.92% of its income as dividend. This is not a sustainable payout ratio.
DP163.92%
EPS Next 2Y6.83%
EPS Next 3Y9.56%
TELUS CORP
TSX:T (12/27/2024, 7:00:00 PM)
19.46
-0.29 (-1.47%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners56.27%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap29.20B
Analysts74.78
Price Target24.87 (27.8%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.13% |
Dividend Growth(5Y)-1.08%
DP163.92%
Div Incr Years21
Div Non Decr Years22
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)14.75%
Min EPS beat(2)12.95%
Max EPS beat(2)16.54%
EPS beat(4)4
Avg EPS beat(4)10%
Min EPS beat(4)1.7%
Max EPS beat(4)16.54%
EPS beat(8)6
Avg EPS beat(8)0.9%
EPS beat(12)8
Avg EPS beat(12)0.21%
EPS beat(16)9
Avg EPS beat(16)-1.11%
Revenue beat(2)0
Avg Revenue beat(2)-1.75%
Min Revenue beat(2)-2.62%
Max Revenue beat(2)-0.87%
Revenue beat(4)0
Avg Revenue beat(4)-2.76%
Min Revenue beat(4)-4.74%
Max Revenue beat(4)-0.87%
Revenue beat(8)0
Avg Revenue beat(8)-2.39%
Revenue beat(12)1
Avg Revenue beat(12)-2.33%
Revenue beat(16)1
Avg Revenue beat(16)-2.12%
PT rev (1m)-0.32%
PT rev (3m)-0.58%
EPS NQ rev (1m)-0.81%
EPS NQ rev (3m)-19.51%
EPS NY rev (1m)2.75%
EPS NY rev (3m)2.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.85%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.89 | ||
| Fwd PE | 17.95 | ||
| P/S | 1.46 | ||
| P/FCF | 30.96 | ||
| P/OCF | 5.74 | ||
| P/B | 1.85 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.71 |
EPS(TTM)1.03
EY5.29%
EPS(NY)1.08
Fwd EY5.57%
FCF(TTM)0.63
FCFY3.23%
OCF(TTM)3.39
OCFY17.41%
SpS13.31
BVpS10.51
TBVpS-10.05
PEG (NY)2.28
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.62% | ||
| ROE | 5.85% | ||
| ROCE | 6.74% | ||
| ROIC | 5.08% | ||
| ROICexc | 5.17% | ||
| ROICexgc | 14.35% | ||
| OM | 16.24% | ||
| PM (TTM) | 4.62% | ||
| GM | 63.01% | ||
| FCFM | 4.72% |
ROA(3y)2.64%
ROA(5y)3.06%
ROE(3y)8.64%
ROE(5y)10.5%
ROIC(3y)5.49%
ROIC(5y)5.87%
ROICexc(3y)5.6%
ROICexc(5y)5.98%
ROICexgc(3y)15.45%
ROICexgc(5y)15.6%
ROCE(3y)7.17%
ROCE(5y)7.66%
ROICexcg growth 3Y-0.69%
ROICexcg growth 5Y-3.68%
ROICexc growth 3Y-4.39%
ROICexc growth 5Y-7.84%
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%
F-Score5
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | 30.67 | ||
| Debt/EBITDA | 3.6 | ||
| Cap/Depr | 101.85% | ||
| Cap/Sales | 20.74% | ||
| Interest Coverage | 2.46 | ||
| Cash Conversion | 69.57% | ||
| Profit Quality | 102.17% | ||
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.63 | ||
| Altman-Z | 0.95 |
F-Score5
WACC5.82%
ROIC/WACC0.87
Cap/Depr(3y)136.39%
Cap/Depr(5y)137.77%
Cap/Sales(3y)26.32%
Cap/Sales(5y)26.11%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)9.57%
EPS 3Y-3.89%
EPS 5Y-7.85%
EPS Q2Q%12%
EPS Next Y8.29%
EPS Next 2Y6.83%
EPS Next 3Y9.56%
EPS Next 5Y19.02%
Revenue 1Y (TTM)0.46%
Revenue growth 3Y9.25%
Revenue growth 5Y7.25%
Sales Q2Q%1.82%
Revenue Next Year0.35%
Revenue Next 2Y1.57%
Revenue Next 3Y2.65%
Revenue Next 5Y2.36%
EBIT growth 1Y9.56%
EBIT growth 3Y3.08%
EBIT growth 5Y1.81%
EBIT Next Year156.71%
EBIT Next 3Y40.87%
EBIT Next 5Y24.74%
FCF growth 1Y171.44%
FCF growth 3Y-11.76%
FCF growth 5Y-3.14%
OCF growth 1Y10.98%
OCF growth 3Y-0.55%
OCF growth 5Y2.08%