Q: Telus has been in my portfolio following the BE Portfolio basically since 5i started (I joined the first day) and I think I actually even owned it before that.
With it getting completely smashed over the last while and seemingly overblown concerns about its dividend, should we be adding to it here? I have a 2.3% weighting currently (this started at a 5% weighting in the BE Portfolio) due to it underperforming the rest of the portfolio so much. Should we add to it here to take on the 9+% dividend or should we leave it and watch it or are there better suggestions to put new money to work today?
This stock is so hated today, it makes me wonder if we should be adding to it while no one likes it.
With it getting completely smashed over the last while and seemingly overblown concerns about its dividend, should we be adding to it here? I have a 2.3% weighting currently (this started at a 5% weighting in the BE Portfolio) due to it underperforming the rest of the portfolio so much. Should we add to it here to take on the 9+% dividend or should we leave it and watch it or are there better suggestions to put new money to work today?
This stock is so hated today, it makes me wonder if we should be adding to it while no one likes it.
5i Research Answer:
Like BNS over the past year, a shift in sentiment from negative to positive can be a big positive driver for stock prices. We would look at this answer from yesterday on T. Because of its need to continue to spend on its network, a recovery might take longer if it does occur. We would not see the need to add much to an existing position above 2% and might prefer to see it settle down a bit. If things go well a 2.3% position could possibly rise towards 3% and we would see that as enough for now, rather than 'betting' more on a short term bounce.