Telus Corp.

TELUS CORP. $33.31 (Toronto symbol T.A; Shares outstanding: 335.6 million; Market cap: $11.1 billion; SI Rating: Above Average) has purchased privately owned Black’s Photo Corp. Black’s owns and operates 113 stores that sell film, cameras and other photographic equipment. Telus plans to sell its wireless phones through these stores. As well, most cellphones now come with built-in cameras, so Black’s could help Telus tap into rising demand for digital-photo printing and other photo-related products and services. Telus paid $28 million for Black’s, which is just 11% of its second-quarter earnings of $244 million, or $0.77 a share....

ENCANA CORP., $63.52, Toronto symbol ECA, rose 7% on Friday after the company announced that it will split itself into two separate companies. One will keep the EnCana name, and will focus on unconventional natural gas. The other will operate as Cenovus Energy Inc., and will specialize in oil-sands projects, oil refineries and conventional natural gas. The new EnCana will account for about two-thirds of the company’s current production and reserves. Cenovus will account for the remaining third. EnCana had hoped to complete the split in early 2009, but the stock-market decline and tight credit markets would have made it difficult for the two new, smaller companies to raise capital to fund new projects. Now that conditions have improved, EnCana has decided to go ahead with the split....

TELUS CORP. (Toronto symbols T $34 and T.A $33; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 317.7 million; Market cap: $10.8 billion; Price-to-sales ratio: 1.1; SI Rating: Above Average) has purchased privately owned Black’s Photo Corp., which operates 113 stores that sell cameras, film and other photographic equipment. Telus plans to sell its cellphones and wireless services through Black’s. This looks like a good fit, as more consumers are using their cellphones to take pictures and videos. Adding Black’s will also help Telus compete with BCE, which recently bought consumer-electronics retailer The Source in an effort to attract new wireless customers. The company paid just $28 million for Black’s, which is equal to 11% of the $244 million, or $0.77 a share, that it earned in the three months ended June 30, 2009. Telus is a buy. The non-voting “A” shares are the better choice.

IMPERIAL OIL LTD. $40 earned $0.25 a share in the three months ended June 30, 2009. That’s down 80.5% from $1.28 a year earlier. The drop was mainly caused by falling crude-oil and natural-gas prices. As well, its Cold Lake and 25%-owned Syncrude oil-sands projects were closed for maintenance during...

ISHARES DIVIDEND INDEX FUND $16.92 (Toronto symbol XDV; buy or sell through a broker) currently holds the 30 highest yielding Canadian stocks. Stocks are included in the index based on their dividend growth, yield and average payout ratio. The weight of any one stock in the fund is limited to 10% of the fund’s assets. iShares Dividend Index Fund’s MER is 0.50%. The fund now yields 4.8%. The fund’s top holdings are: National Bank of Canada, 8.9%; Bank of Montreal, 8.0%; CIBC at 7.2%; TD Bank, 6.3%; IGM Financial, 5.0%; Bank of Nova Scotia, 5.0%; Royal Bank of Canada, 4.9%; Manitoba Telecom 4.6%; TMX Group, 3.6%; Sun Life Financial, 3.2%; Power Financial Corp., 3.2%; Telus Corp., 3.1%; and Russel Metals, 2.8%....

TELUS CORP. $30 (Toronto symbol T.A; Shares outstanding: 335.6 million; Market cap: $10.1 billion; SI Rating: Above Average) has won a $31.5-million expansion of its contract with the Montreal Regional Health Authority. Telus will speed up the conversion of patient records from paper to electronic form. This is a small sum next to Telus’s $9.7 billion in annual revenue, but electronic record conversion is a fast-growing field. Telus launched a new division in late 2008 called “Telus Health Solutions”....

BANK OF NOVA SCOTIA $40 reported record revenue in its latest quarter, despite the recession. Revenue rose 13.4%, to $3.6 billion from $3.2 billion a year earlier. However, earnings per share fell 16.5%, to $0.81 from $0.97, as loan-loss provisions jumped 219.6%. Still, the bank is in a good position to increase its profits as the economy improves. Best Buy. ROYAL BANK OF CANADA $46 lost $50 million, or $0.07 a share, in the three months ended April 30, 2009. This figure includes a $1-billion writedown of goodwill related to the American banks that Royal bought over the past few years. The slow U.S. housing market and economy have driven down the goodwill related to these purchases. Without this writedown, Royal would have earned $950 million, up 2.4% from $928 million a year earlier. Per-share earnings fell 10%, to $0.63 from $0.70, on more shares outstanding. Buy. TELUS CORP. $32 has won a $31.5-million expansion of its contract with the Montreal Regional Health Authority. Telus will speed up the conversion of patient records from paper to electronic form. This is a small sum next to Telus’s $9.7 billion in annual revenue, but electronic record conversion is a fast-growing field. Buy.

Yellow Pages Income Fund, $5.50, symbol YLO.UN on Toronto (Units outstanding: 509.3 million; Market cap: $2.8 billion), is the largest telephone-directory publisher in Canada, where it owns the Yellow Pages and Pages Jaunes trademarks. Aside from phone directories, it prints free, advertising-based publications, including Auto Trader, Buy & Sell and Renters News, through 98%-owned Trader Corp. It also operates web sites devoted to classified advertising. The fund gets 80% of its sales from its print and online directories, which it sells in all Canadian provinces except Saskatchewan. The other 20% comes from classified advertising (both in print and on the web), which it sells in all provinces. Yellow Pages publishes over 340 different telephone directories with a total circulation of around 30 million copies. The fund prints directories for a number of phone companies, including Bell Canada, Telus and MTS Allstream Inc. It also operates a number of related web sites, including YellowPages.ca, Canada411.ca, the CanadaPlus.ca group of seven city sites and 20 sites based on its Trader publications....

TELUS INC. (Toronto symbols T $30 and T.A $29; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 318 million; Market cap: $9.5 billion; Price-to-sales ratio: 1.0; SI Rating: Above Average) hopes to improve its sales by bundling its phone and Internet services with satellite TV. Under a new deal with BCE INC. $24 (Toronto symbol BCE; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 780.6 million; Market cap: $18.7 billion; Price-to-sales ratio: 1.1; SI Rating: Above Average), Telus will sell BCE’s satellite-TV service in Alberta and British Columbia under the Telus brand. BCE and Telus will share the proceeds from these sales. The deal also lets BCE keep selling satellite service in the same region under the “Bell TV” name. Telus is a buy. The cheaper, non-voting “A” shares are the better choice. BCE is also a buy.

TELUS CORP. $29.45 (Toronto symbol T.A; Shares outstanding: 335.6 million; Market cap: $9.9 billion; SI Rating: Above Average) attracted just 48,000 new wireless subscribers during the first quarter of 2009. This is down 46% from the year-earlier quarter. Wireless accounts for half of Telus’s revenue and earnings. The recession has forced more businesses and consumers to deactivate their cellphones or switch to cheaper monthly plans. Despite the slower growth, Telus has 9.2% more wireless subscribers than it did a year ago. Recently, it has been improving the speed and reliability of its network, which should help it compete with several new wireless licence holders that could enter the market next year....