telus

TELUS $39.14 (Toronto symbol T; Shares outstanding: 623.4 million; Market cap: $24.6 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.telus.com) has paid an undisclosed sum for Groupe Enode Inc., a privately held Quebec firm whose software protects databases from online intruders.

Enode’s expertise should help Telus attract more government and corporate clients and make its cloud computing services more secure....

TELUS CORP. $39 (Toronto symbol T; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 623.4 million; Market cap: $24.3 billion; Price-to-sales ratio: 2.2; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.telus.com) gets 54% of its revenue from its 7.8 million wireless subscribers across Canada. It also has 3.3 million phone customers, 1.4 million highspeed Internet users and 815,000 TV subscribers.

The company spent $1.14 billion on new spectrum in the recent auction. That will let it expand its high-speed wireless network to reach 97% of Canada’s population, up from 80% now.

Meanwhile, strong demand for wireless and high-speed Internet continues to offset weaker revenue from its land line business. Telus earned $1.4 billion in 2013, up 13.4% from $1.2 billion in 2012. Due to fewer shares outstanding, earnings per share gained 15.5%, to $2.16 from $1.87. Revenue rose 4.4%, to $11.4 billion from $10.9 billion.
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PRECISION DRILLING CORP., $12.89, Toronto symbol PD, announced two new contracts this week. The first is a multi-year deal with a client in the Middle East to build a Super Triple drilling rig, which can reach deeper pockets of oil and natural gas than Precision’s regular rigs. The company will deliver this rig in the fourth quarter of 2014. The second is a multi-year contract to supply six rigs to a project in Mexico....

The Canadian government recently auctioned off blocks of radio frequencies, or spectrum, to several wireless providers, including Telus and Manitoba Telecom. This spectrum can travel further than other frequencies and pass through solid objects better, so it will help both firms enhance their services....

BANK OF NOVA SCOTIA, $63.61, Toronto symbol BNS, continues to benefit from strong car loan and credit card demand in Canada, rising stock markets and an acquisition. The bank’s November 2012 purchase of ING Direct, which offers no-fee banking services over the Internet, continues to spur its growth. Bank of Nova Scotia will soon change this business’s name to Tangerine, which will let it keep using the orange colour associated with the ING Direct brand. As well, rising stock markets have increased the value of the assets the bank’s wealth management business administers. However, volatile currency exchange rates and higher costs have hurt profits at its international banking operations....

Canoe EIT Income Fund, $11.99, symbol EIT.UN on Toronto (Units outstanding: 89.9 million; Market cap: $1.1 billion; www.canoefinancial.com), changed its name from EnerVest Diversified Income Trust in November 2013. The stock symbol remained the same. Canoe EIT is a closed-end fund that invests in a portfolio of stocks that are mainly listed on the Toronto exchange, with a focus on dividend income. The fund trades at a 16.6% discount to its net asset value and has an MER of 1.45%. The fund’s top holdings are TD Bank, Bank of Nova Scotia, Royal Bank of Canada, CN Rail, Crescent Point Energy, Telus, Microsoft, Boeing, Encana and Wells Fargo. Canoe EIT has 33.8% of its assets in finance stocks and 25.1% in oil and gas firms....

ISHARES DOW JONES CANADA SELECT DIVIDEND INDEX FUND $23.86 (Toronto symbol XDV; buy or sell through brokers; ca.ishares.com) holds 30 of the highest-yielding Canadian stocks. Its selections are based on dividend growth, yield and payout ratio. The weight of any one stock is limited to 10% of its assets. The fund’s MER is 0.55%. It yields 4.1%.

The fund’s top holdings are CIBC, 6.8%; National Bank, 6.4%; Bonterra Energy, 6.4%; TD Bank, 5.9%; Bank of Montreal, 5.7%; Telus, 4.7%; Royal Bank, 4.6%; IGM Financial, 4.5%; Bank of Nova Scotia, 4.3%; and BCE, 4.0%.

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ISHARES S&P/TSX 60 INDEX FUND $19.25 (Toronto symbol XIU; buy or sell through brokers; ca.ishares.com) is a good low-fee way to buy the top stocks on the TSX. The units are made up of stocks that represent the S&P/TSX 60 Index, which consists of the 60 largest, most heavily traded stocks on the exchange. Expenses are just 0.17% of assets.

The index mostly consists of high-quality companies. However, it must ensure that all sectors are represented, so it holds a few we wouldn’t include.

The index’s top holdings are Royal Bank, 8.3%; TD Bank, 7.3%; Bank of Nova Scotia, 6.4%; Suncor Energy, 4.5%; CN Railway, 4.1%; Bank of Montreal, 3.9%; Manulife Financial, 3.1%; Canadian Natural Resources, 3.1%; CIBC, 3.0%; BCE, 3.0%; Enbridge, 3.0%; Valeant Pharmaceuticals, 2.9%; TransCanada Corporation, 2.7%; Potash Corp., 2.4%; CP Rail, 2.1%; Telus, 2.0%; and Cenovus, 1.9%.
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TELUS $37.34 (Toronto symbol T; Shares outstanding: 623.2 million; Market cap: $23.3 billion; TSINetwork Rating: Above Average; Dividend yield: 3.9%; www.telus.com) continues to benefit from heavy investments in its wireless networks.

Thanks to rising demand for smartphones and wireless data, Telus’s earnings rose 18.4% in the third quarter of 2013, to $0.58 a share from $0.49. It also increased its dividend by 5.9%. The new annual rate of $1.44 yields 3.9%.

However, Ottawa’s plan to cut wireless roaming fees adds to its risk. As well, the new free trade deal with Europe could open up Canada’s wireless industry to more foreign competition.
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Exchange traded funds (ETFs) are set up to mirror the performance of a stock-market index or subindex. They hold a more or less fixed selection of securities that represent the holdings that go into the calculation of the index or sub-index....