Investors are closely monitoring Telus (TSX:T) as it trades at approximately $19.25. This Canadian telecommunications company has faced significant challenges but may present a unique buying opportunity in 2026.
Overview of Telus Stock Performance
Over the past few years, Telus has struggled, falling significantly from a peak of $30 four years ago. However, the stock has rebounded, rising more than 6% in early 2026.
Challenges Facing Telus
- Debt Levels: Telus carries a substantial amount of debt. This is typical for telecom companies, which require large capital investments for network infrastructure.
- Impact of Interest Rates: The rise in interest rates during 2022 and 2023 negatively affected telecom stocks, increasing debt service costs.
- Price Wars: Intense competition within the Canadian telecom sector has affected revenue and profit margins.
- Immigration Policy: Canada’s restrictions on immigration have also limited the growth of new mobile and internet subscribers.
Recent Developments
In light of these challenges, Telus paused its dividend-growth program last year. This decision aims to stabilize its share price amidst ongoing pressures. A continuation of declining revenue or a sudden increase in interest rates could lead to further cuts to dividend distributions.
Future Prospects for Telus
Despite the difficulties, there are signs of stabilization. The most intense price competition may be subsiding, allowing carriers to focus on improving profitability. Additionally, Telus took its subsidiary, Telus Digital, private in 2025. This move is expected to create operational synergies over the coming years.
Investment Considerations
Investors looking for income may find Telus attractive. The current dividend yield stands at about 8.7%. However, this is contingent on the perception that the dividend is sustainable.
Conclusion: Is Telus Stock a Smart Buy at $19?
While Telus faces several hurdles, many analysts believe that much of the negative news is already priced into the stock. For investors with a long-term perspective, Telus may warrant consideration, particularly for those interested in dividend stocks.
Ultimately, prospective shareholders should weigh the potential rewards against the risks, given the company’s current circumstances and outlook..
