Telus Corp.

Exchange traded funds (ETFs) may have a place in your portfolio. That’s because, unlike many other financial innovations, they don’t load you up with heavy management fees or tie you down with high redemption charges if you decide to get out of them. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell ETFs. However, ETFs’ low management fees still give them a cost advantage over most conventional mutual funds. As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital gains bills generated by the yearly distributions most conventional mutual funds pay out to unitholders....

TELUS $54.45 (Toronto symbol T.A; Shares outstanding: 324.5 million; Market cap: $17.7 billion; TSINetwork Rating: Above Average; Dividend yield: 4.3%; www.telus.com) continues to benefit from rising smartphone demand. Smartphone users now account for 48% of its wireless subscribers, up from 28% a year ago. In the three months ended September 30, 2011, Telus added 114,000 new wireless subscribers, down 25.5% from 153,000 a year earlier. However, 70% of these new long-term customers use smartphones. That pushed up demand for data services, such as web browsing. As a result, Telus’s revenue rose 6.5% in the quarter, to $2.6 billion. Earnings per share rose 28.2%, to $1.00 from $0.78....

MANITOBA TELECOM SERVICES INC. $29.80 (Toronto symbol MBT; Shares outstanding: 65.7 million; Market cap: $2.0 billion; TSINetwork Rating: Average; Dividend yield: 5.7%; www.mts.ca) has over 1.3 million telephone and wireless customers in Manitoba. This business now accounts for 54% of the company’s revenue.

The remaining 46% comes from its Allstream division, which provides integrated telephone, Internet and other communication services to businesses across Canada.

In the three months ended September 30, 2011, Manitoba Tel’s revenue fell 1.7%, to $443.2 million from $451.0 million a year earlier. The MTS division’s revenue rose 0.7%. Allstream’s revenue fell 4.6%, mostly because it is closing less-profitable businesses. Earnings per share fell 8.2%, to $0.56 from $0.61. The stock yields a high 5.7%.

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MANITOBA TELECOM SERVICES INC. (Toronto symbol MBT; www.mts.ca) has over 1.3 million telephone and wireless customers in Manitoba. This business now accounts for 54% of the company’s revenue. The remaining 46% comes from its Allstream division, which provides integrated telephone, Internet and other communication services to businesses across Canada....

BELL ALIANT INC. $28.65 (Toronto symbol BA: Shares outstanding: 227.8 million; Market cap: $6.5 billion; TSINetwork Rating: Above Average; Yield: 6.6%; www.aliant.ca) sells telephone and Internet services to 2.8 million customers in Atlantic Canada, as well as rural parts of Ontario and Quebec. The company also sells wireless services through an alliance with BCE, which owns 43.8% of Bell Aliant. The company faces strong competition from cable providers. In addition, many of its phone customers are switching to wireless devices. However, Bell Aliant’s wireless agreement with BCE and recent upgrades to its high-speed Internet network are helping it hold on to clients and attract new ones. Bell Aliant earned $0.75 a share in the three months ended September 30, 2011. A year earlier, it earned just $0.21 a share....

TELUS CORP. (Toronto symbols T $54 and T.A $51; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 324.5 million; Market cap: $17.5 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.telus.com) continues to benefit from rising demand for smartphones, like the iPhone and devices that run Google’s Android operating system. In the three months ended September 30, 2011, Telus added 114,000 new wireless subscribers, net of deactivations. That’s down 25.5% from 153,000 a year earlier. However, 70% of these new long-term customers use smartphones. That pushed up demand for data services, such as web browsing. As a result, Telus’s revenue rose 6.5% in the quarter, to $2.6 billion from $2.5 billion a year earlier. Earnings rose 29.9%, to $326 million from $251 million. Earnings per share rose 28.2%, to $1.00 from $0.78, on more shares outstanding....

TRANSCANADA CORP., $42.37, Toronto symbol TRP, is still waiting for final approval to proceed with its proposed Keystone XL oil pipeline. Keystone XL includes the third and fourth phases of a four-phase, $13-billion U.S. project; phases one and two are already pumping crude oil from the Alberta oil sands to refineries in the U.S. Midwest. Keystone XL will cost $7 billion U.S., and will pump oil from Alberta through Oklahoma to the U.S. Gulf Coast. So far, TransCanada has spent $1.9 billion U.S. on Keystone XL. The U.S government should make a final decision by the end of 2011. If the pipeline is approved, TransCanada expects to complete it in the second half of 2013....

LOBLAW COMPANIES $38.50 (Toronto symbol L; Shares outstanding: 298.5 million; Market cap: $11.5 billion; TSINetwork Rating: Above Average; Dividend yield: 2.2%; www.loblaw.ca) started selling mobile phones and prepaid plans under the President’s Choice Mobile brand in 2005. It sells these products through self-serve kiosks in about half of its 1,000 supermarkets. Loblaw now plans to open full-service mobile phone shops in up to 200 of its stores by the end of 2012. These shops will sell more sophisticated mobile products, such as smartphones and tablet computers, in addition to the basic phones that Loblaw currently carries. They will also offer mobile service plans from national wireless providers, like Bell and Telus. The new shops should help Loblaw attract more customers to its supermarkets and increase its sales. The company aims to become Canada’s third-largest mobile phone seller by the end of 2013....

ISHARES DOW JONES CANADA SELECT DIVIDEND INDEX FUND $19.60 (Toronto symbol XDV; buy or sell through a broker; 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 0.50%. Its yield is 2.7%. The fund’s top holdings are CIBC, 6.6%; Bank of Montreal, 5.3%; Bonterra Energy, 5.2%; National Bank, 4.9%; TD Bank, 4.9%; Telus, 4.8%; IGM Financial, 4.3%; Enbridge, 4.2%; BCE, 4.2%; Canadian Utilities, 3.7%; and Manitoba Telecom, 3.7%. The fund holds 50.2% of its assets in financial stocks. Utilities are next, at 26.4%. The top Canadian finance stocks have sound prospects. However, if you invest in this ETF, be sure to adjust the rest of your portfolio so it won’t be overly concentrated in the financial sector....

TELUS $48.57 (Toronto symbol T.A; Shares outstanding: 335.6 million; Market cap: $16.3 billion; TSINetwork Rating: Above Average; Dividend yield: 4.5%; www.telus.com) is Canada’s second-largest telephone and wireless provider after BCE Inc.. Telus has 7.1 million wireless subscribers across Canada, and gets twice as much of its revenue from wireless as BCE (52% compared to BCE’s 26%). The company continues to expand its wireless business. Telus gets the remaining 48% of its revenue from its traditional phone business, which has 3.7 million customers in B.C., Alberta and eastern Quebec. Telus also has 1.2 million Internet subscribers....