TELUS CORP (T.CA) Stock Fundamental Analysis
TSX:T - Toronto Stock Exchange - CA87971M1032 - Common Stock - Currency: CAD
Overall T gets a fundamental rating of 4 out of 10. We evaluated T against 30 industry peers in the Diversified Telecommunication Services industry. While T is still in line with the averages on profitability rating, there are concerns on its financial health. T is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year T was profitable.
In the past year T had a positive cash flow from operations.
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
With an excellent Return On Assets value of 1.71%, T belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
T has a better Return On Equity (6.36%) than 83.33% of its industry peers.
With a Return On Invested Capital value of 5.04%, T is not doing good in the industry: 83.33% of the companies in the same industry are doing better.
T had an Average Return On Invested Capital over the past 3 years of 5.16%. This is in line with the industry average of 6.94%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.71% | ||
| ROE | 6.36% | ||
| ROIC | 5.04% |
ROA(3y)2.07%
ROA(5y)2.49%
ROE(3y)7.11%
ROE(5y)8.46%
ROIC(3y)5.16%
ROIC(5y)5.5%
1.3 Margins
T has a better Profit Margin (4.93%) than 86.67% of its industry peers.
T's Profit Margin has declined in the last couple of years.
The Operating Margin of T (15.76%) is worse than 86.67% of its industry peers.
T's Operating Margin has declined in the last couple of years.
T has a Gross Margin of 62.97%. This is amonst the worse of the industry: T underperforms 83.33% of its industry peers.
T's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.76% | ||
| PM (TTM) | 4.93% | ||
| GM | 62.97% |
OM growth 3Y-6.27%
OM growth 5Y-5.58%
PM growth 3Y-20.54%
PM growth 5Y-16.25%
GM growth 3Y1.26%
GM growth 5Y1.39%
2. Health
2.1 Basic Checks
T has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, T has more shares outstanding
T has more shares outstanding than it did 5 years ago.
T has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.97, we must say that T is in the distress zone and has some risk of bankruptcy.
With an excellent Altman-Z score value of 0.97, T belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
T has a debt to FCF ratio of 56.93. This is a negative value and a sign of low solvency as T would need 56.93 years to pay back of all of its debts.
The Debt to FCF ratio of T (56.93) is worse than 83.33% of its industry peers.
A Debt/Equity ratio of 1.70 is on the high side and indicates that T has dependencies on debt financing.
T has a better Debt to Equity ratio (1.70) than 90.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.7 | ||
| Debt/FCF | 56.93 | ||
| Altman-Z | 0.97 |
ROIC/WACC0.85
WACC5.9%
2.3 Liquidity
A Current Ratio of 0.68 indicates that T may have some problems paying its short term obligations.
T has a better Current ratio (0.68) than 93.33% of its industry peers.
A Quick Ratio of 0.61 indicates that T may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.61, T belongs to the top of the industry, outperforming 93.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
T shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.24%, which is quite good.
Measured over the past years, T shows a decrease in Earnings Per Share. The EPS has been decreasing by -6.10% on average per year.
Looking at the last year, T shows a small growth in Revenue. The Revenue has grown by 0.67% in the last year.
T shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.66% yearly.
EPS 1Y (TTM)10.24%
EPS 3Y-0.09%
EPS 5Y-6.1%
EPS Q2Q%7.21%
Revenue 1Y (TTM)0.67%
Revenue growth 3Y6.15%
Revenue growth 5Y6.66%
Sales Q2Q%5.74%
3.2 Future
T is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.82% yearly.
Based on estimates for the next years, T will show a small growth in Revenue. The Revenue will grow by 3.28% on average per year.
EPS Next Y-1.63%
EPS Next 2Y6.82%
EPS Next 3Y10.24%
EPS Next 5Y21.82%
Revenue Next Year2.99%
Revenue Next 2Y3.03%
Revenue Next 3Y3.26%
Revenue Next 5Y3.28%
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.
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 21.13, which indicates a rather expensive current valuation of T.
Based on the Price/Earnings ratio, T is valued more expensive than 86.67% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.63. T is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 21.54 indicates a rather expensive valuation of T.
Compared to the rest of the industry, the Price/Forward Earnings ratio of T indicates a rather expensive valuation: T more expensive than 83.33% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of T to the average of the S&P500 Index (22.68), we can say T is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.13 | ||
| Fwd PE | 21.54 |
4.2 Price Multiples
T's Enterprise Value to EBITDA ratio is rather expensive when compared to the industry. T is more expensive than 86.67% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, T is valued expensively inside the industry as 86.67% of the companies are valued cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 63.79 | ||
| EV/EBITDA | 8.51 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y6.82%
EPS Next 3Y10.24%
5. Dividend
5.1 Amount
T has a Yearly Dividend Yield of 7.37%, which is a nice return.
T's Dividend Yield is slightly below the industry average, which is at 10.71.
T's Dividend Yield is rather good when compared to the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.37% |
5.2 History
The dividend of T has a limited annual growth rate of 1.90%.
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)1.9%
Div Incr Years21
Div Non Decr Years22
5.3 Sustainability
T pays out 157.30% of its income as dividend. This is not a sustainable payout ratio.
T's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP157.3%
EPS Next 2Y6.82%
EPS Next 3Y10.24%
TSX:T (2/21/2025, 7:00:00 PM)
22.19
+0.37 (+1.7%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners57.34%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap33.36B
Analysts74.17
Price Target23.34 (5.18%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.37% |
Yearly Dividend1.05
Dividend Growth(5Y)1.9%
DP157.3%
Div Incr Years21
Div Non Decr Years22
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)15.26%
Min EPS beat(2)13.98%
Max EPS beat(2)16.54%
EPS beat(4)4
Avg EPS beat(4)13.07%
Min EPS beat(4)8.8%
Max EPS beat(4)16.54%
EPS beat(8)7
Avg EPS beat(8)5.24%
EPS beat(12)9
Avg EPS beat(12)2.37%
EPS beat(16)10
Avg EPS beat(16)0.55%
Revenue beat(2)1
Avg Revenue beat(2)1.05%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)2.97%
Revenue beat(4)1
Avg Revenue beat(4)-1.32%
Min Revenue beat(4)-4.74%
Max Revenue beat(4)2.97%
Revenue beat(8)1
Avg Revenue beat(8)-1.76%
Revenue beat(12)1
Avg Revenue beat(12)-2.14%
Revenue beat(16)2
Avg Revenue beat(16)-1.84%
PT rev (1m)-5.1%
PT rev (3m)-6.33%
EPS NQ rev (1m)-3.76%
EPS NQ rev (3m)-10.98%
EPS NY rev (1m)-4.97%
EPS NY rev (3m)-5.01%
Revenue NQ rev (1m)-1.43%
Revenue NQ rev (3m)-1.91%
Revenue NY rev (1m)1.05%
Revenue NY rev (3m)0.05%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.13 | ||
| Fwd PE | 21.54 | ||
| P/S | 1.66 | ||
| P/FCF | 63.79 | ||
| P/OCF | 6.88 | ||
| P/B | 2.14 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.51 |
EPS(TTM)1.05
EY4.73%
EPS(NY)1.03
Fwd EY4.64%
FCF(TTM)0.35
FCFY1.57%
OCF(TTM)3.22
OCFY14.53%
SpS13.39
BVpS10.39
TBVpS-10.32
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.71% | ||
| ROE | 6.36% | ||
| ROCE | 6.59% | ||
| ROIC | 5.04% | ||
| ROICexc | 5.13% | ||
| ROICexgc | 14.47% | ||
| OM | 15.76% | ||
| PM (TTM) | 4.93% | ||
| GM | 62.97% | ||
| FCFM | 2.6% |
ROA(3y)2.07%
ROA(5y)2.49%
ROE(3y)7.11%
ROE(5y)8.46%
ROIC(3y)5.16%
ROIC(5y)5.5%
ROICexc(3y)5.26%
ROICexc(5y)5.61%
ROICexgc(3y)14.67%
ROICexgc(5y)15.27%
ROCE(3y)6.66%
ROCE(5y)7.09%
ROICexcg growth 3Y-6.18%
ROICexcg growth 5Y-3.5%
ROICexc growth 3Y-7.23%
ROICexc growth 5Y-7.25%
OM growth 3Y-6.27%
OM growth 5Y-5.58%
PM growth 3Y-20.54%
PM growth 5Y-16.25%
GM growth 3Y1.26%
GM growth 5Y1.39%
F-Score5
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.7 | ||
| Debt/FCF | 56.93 | ||
| Debt/EBITDA | 3.68 | ||
| Cap/Depr | 107.14% | ||
| Cap/Sales | 21.47% | ||
| Interest Coverage | 2.39 | ||
| Cash Conversion | 67.23% | ||
| Profit Quality | 52.67% | ||
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.61 | ||
| Altman-Z | 0.97 |
F-Score5
WACC5.9%
ROIC/WACC0.85
Cap/Depr(3y)107.1%
Cap/Depr(5y)125.25%
Cap/Sales(3y)21.07%
Cap/Sales(5y)24.41%
Profit Quality(3y)62.22%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)10.24%
EPS 3Y-0.09%
EPS 5Y-6.1%
EPS Q2Q%7.21%
EPS Next Y-1.63%
EPS Next 2Y6.82%
EPS Next 3Y10.24%
EPS Next 5Y21.82%
Revenue 1Y (TTM)0.67%
Revenue growth 3Y6.15%
Revenue growth 5Y6.66%
Sales Q2Q%5.74%
Revenue Next Year2.99%
Revenue Next 2Y3.03%
Revenue Next 3Y3.26%
Revenue Next 5Y3.28%
EBIT growth 1Y6.3%
EBIT growth 3Y-0.51%
EBIT growth 5Y0.7%
EBIT Next Year155.88%
EBIT Next 3Y40.7%
EBIT Next 5Y23.95%
FCF growth 1Y-39.68%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y7.74%
OCF growth 3Y3.37%
OCF growth 5Y4.3%