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Telus stock price
Telus is trading near $18.50 per share at the time of writing. The stock is down about 19% over the past 12 months, a far cry from the $34 it reached in 2022 before beginning an extended decline.
Rising interest rates in 2022 and 2023 caused the initial decline in the share price of Telus and its communications peers. Telecom companies have large amounts of debt on their balance sheets due to the significant amounts they need to borrow to finance their capital programs. It is expensive to build and upgrade wired and wireless network infrastructure, especially in Canada, where there is a relatively small population spread over a huge geographic area.
The sharp increase in financing costs could drive up debt costs. This puts pressure on profits and cuts cash available to pay dividends or reduce debt.
The Bank of Canada cut rates in 2024 and 2025, but Telus remained under pressure from other challenges. The company’s subsidiary Telus Digital (Telus International) saw a significant drop in revenue. At the same time, Telus was waging a price war with its competitors in the domestic market. This squeezed margins on wireless plans. The restrictions imposed on immigration over the past two years have also affected the sector, as fewer new arrivals have come to buy mobile devices and sign up for data services.
In late 2025, Telus announced it would pause dividend increases as a measure to halt its share price decline and focus more on strengthening its balance sheet.
Possibility
Telus has made progress in monetizing certain assets to reduce its debt burden. The company sold a 49.9% stake in its mobile tower portfolio last year. Telus is considering options to sell part of its Telus Health business to raise additional funds. As more capital is freed up and used to strengthen the balance sheet, the market may become more comfortable with the sustainability of the dividend.
Telus also recently announced that a new CEO will take over in July. Victor Dodig, the former CEO of CIBC, will become the new top boss. New CEOs often make aggressive moves when implementing a turnaround strategy. If successful, this could send share prices significantly higher.
However, analysts are also wondering whether the new CEO will cut the dividend as one of his first steps to free up cash to reduce debt. This is certainly possible and should be considered by investors who hold Telus primarily for the dividend income.
The bottom line
Short-term volatility is expected, but most of the negative news should already be reflected in the share price, and there is considerable upside potential if the new CEO can deliver on the turnaround strategy. If you have a contrarian investing style, Telus deserves to be on your radar today.
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