Q: Telus is something I've been on the cusp of buying over the years but never pulled the trigger.
Is this a good time or is there some structural that is supporting such a high dividend? Is it the interest rate expectations that are causing Telus to go down so much?
Is this a good time or is there some structural that is supporting such a high dividend? Is it the interest rate expectations that are causing Telus to go down so much?
5i Research Answer:
The weakness does look to be across telcos in general, vs a Telus specific problem. We think it is a combo of concerns on slower growth, tougher inflation passthrough going forward, higher rates and relative attractiveness of dividends vs what you can get in bonds. Add in poor sentiment as well given recent performance. We don't think its a specific 'issue' at the company though. It probably does make sense to start slowly picking away at these types of names.