Q: Hi Peter and 5i Team,
An article in the Globe & Mail (May 27) was titled:
“Telus to invest more than $70-billion in Canada over next five years to expand infrastructure”
Given that its payout ratio is now approximately 100%, and if interest rates should rise while there’s a slowdown in the economy, is this a prudent decision for Telus to take? Having recently sold BCE at a loss, and still owning T, are my concerns justified?
In the Communications Services Sector, we also have a small position in QBR.B, which is doing reasonably well so far. Its debt leverage is the lowest among its peers, which I believe to be an important metric at this time.
Thanks in advance for your insight.
An article in the Globe & Mail (May 27) was titled:
“Telus to invest more than $70-billion in Canada over next five years to expand infrastructure”
Given that its payout ratio is now approximately 100%, and if interest rates should rise while there’s a slowdown in the economy, is this a prudent decision for Telus to take? Having recently sold BCE at a loss, and still owning T, are my concerns justified?
In the Communications Services Sector, we also have a small position in QBR.B, which is doing reasonably well so far. Its debt leverage is the lowest among its peers, which I believe to be an important metric at this time.
Thanks in advance for your insight.
5i Research Answer:
Telus did $4.8 bln in operating cash flow in 2024 and $4.5 billion in 2023. Dividends are in the...