Telus’s extraordinary yield and deleveraging potential is the strongest argument for buying this firm today . Trading at a depressed price, the stock offers an exceptional dividend yield rarely seen for a blue-chip Canadian utility.
Additionally, this utility is much more than a phone company. That’s because its non-telecom segments are massive value-unlock opportunities. Its health division is valued at over $5 billion while growing revenues at 18% annually, while an AI partnership with Nvidia positions the firm to capture significant enterprise demand for Canadian-hosted AI solutions.
Telus dropped recently on concerns about its competitive markets and fears of a dividend cut. But the company has announced it will maintain its current payout—and will just pause increases for now.
TELUS CORP. (Toronto symbol T) is Canada’s largest wireless carrier with 14.43 million subscribers (including non-cellphone devices such as tablets) as of September 30, 2025. It also sells landline phones, Internet and TV services in B.C., Alberta and eastern Quebec.
Telus also helps clinics, pharmacies and hospitals manage electronic patient records and healthcare plans through its Telus Health division. This business supplies about 10% of its total revenue, and 5% of its earnings.
Telus recently privatized its Telus International subsidiary and sold a stake in its cellphone tower network. These moves should improve its long-term profitability.
Telus acquired the 13.1% of Telus International (Cda) Inc. (Toronto symbol TIXT) that it did not already own for $539 million U.S. This firm, which operates as Telus Digital Experience, runs call centres for corporate clients and helps them manage their computer systems. Buying back full control of Telus International will let it cut $150 million from its annual costs.
Telus also sold 49.9% of its cellphone tower network to the Caisse de dépôt et placement du Québec. It manages that province’s public pension plan. Telus received $1.26 billion and retained a 50.1% stake in Terrion, the new company that will own 3,000 towers across British Columbia, Alberta, Ontario and Quebec.
Telus recently opened a new datacentre in Rimouski, Quebec, to run artificial intelligence (AI) software using advanced chips from Nvidia Corp. (Nasdaq symbol NVDA). The company is also building a second AI datacentre in Kamloops, B.C.
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Telus has not yet said how much these new facilities will cost. However, they should help it attract more clients, particularly as Canadian businesses become wary of storing their data on foreign platforms. The company has already secured deals with Canadian healthcare software provider League, enterprise software firm OpenText and business consulting firm Accenture.
Telus’s significant debt reduction is on the way
Meantime, in the third quarter of 2025, the company added 82,000 new wireless phone subscribers as well as 169,000 users of other devices (both numbers are net of cancellations). However, due to greater competition, the average monthly cellphone revenue per user declined 2.8%.
As a result, revenue in the quarter ended September 30, 2025, rose just 0.1%, to $5.11 billion from $5.10 billion a year earlier. If you exclude unusual items, earnings fell 10.4%, to $370 million from $280 million. Due to more shares outstanding, per-share earnings declined 14.3%, to $0.24 from $0.28. The lower earnings are due to higher depreciation charges and taxes.
With the January 2, 2026, payment, the company raised your quarterly dividend by 0.5%. Investors now receive $0.4184 a share, instead of $0.4163. The new annual rate of $1.674 yields a high 9.0%.
However, to conserve cash for debt repayments and other uses, Telus will pause its previously announced plan to increase the annual rate by 3% to 8% from 2026 through to the end of 2028.
As well, the company will phase out the discount it offers investors who take their dividends in the form of new shares instead of cash.
Telus has reduced the current discount of 2.0% to 1.75% for dividends declared in February and May 2026, and to 1.5% in August and November 2026. The discount will then fall to 1.0% in 2027, and to zero in 2028. The discount reduction’s purpose is to reduce share dilution.
Going forward, Telus has a number of key pluses: BCE and the company are moving into each others’ markets, but BCE’s is bigger. That has let Telus add subscribers at a faster pace than the competition. Meantime, Telus’s cost-control measures are proving effective.
Also, the company’s healthcare assets remain a significant source of growth, and they are likely being undervalued by investors. In fact, Telus is now exploring ways to unlock the value of Telus Health. That could include selling a minority stake to other firms or selling shares to the public.
The company would apply the cash to its long-term debt of $25.73 billion (as of September 30, 2025), which is a high 88% of its market cap.
In addition, the company has virtually completed its capital-intensive copper-to-fibre migration across its network.
Recommendation in The Successful Investor: Telus Corp. is a buy.
