A Canadian dividend stock fell 9% to buy forever

A dividend stock can look especially tempting when it drops because you get paid to wait. Returns rise as the share price falls, and that can turn a boring holding company into a serious income producer. However, the trick is simple. You want a company that still reliably generates money even when the market mood turns sour. If the dividend depends on optimism, the bargain could disappear quickly. So let’s take a look at one that presents a great opportunity.

T

TELUS (TSX:T) is one of Canada’s largest telecom companies. It sells wireless and internet services, and also runs fast-growing side businesses in healthcare and digital services. It has spent years promoting fiber-optic internet to more neighborhoods, while trying to turn health and digital into real profit engines rather than “fancy stories.”

The stock price hasn’t been kind, and you can see why investors keep calling it “down.” TELUS stock has seen its shares fall about 10% over the past year. However, since the highs, it has fallen even further. This relapse has a known cause.

Higher interest rates punish anything with heavy spending plans and significant debt, and telecom companies are right in that explosion zone. TELUS has also faced pressure on wireless pricing and investor fatigue after years of major capital expenditures. The positive side of that pain shows up in one place: income. TELUS currently offers a dividend yield of 9.2%, providing great income for today’s investor.

In income

Now proof that the company is still throwing away cash. In the third quarter of 2025, TELUS reported consolidated operating and other income of $5.1 billion, and generated free cash flow of $611 million, up 8% year over year. Management also said the net debt-to-earnings before interest, taxes, depreciation and amortization (EBITDA) leverage ratio improved to 3.5 times by the end of the quarter; So concerns about debt are driving much of the swing in stocks.

Earnings seemed mixed, which is exactly why the stock still feels unloved. TELUS reported net income of $431 million in the third quarter of 2025, and adjusted net income of $370 million. Per share, basic earnings per share (EPS) were $0.32 and adjusted basic earnings per share were $0.24. It also raised its quarterly dividend to $0.4184 per share, matching the “keep paying, keep growing cautiously” message that investors have come to expect.

The near-term outlook became fairer in early December 2025, and I actually like that. TELUS set expectations for about $2.15 billion in free cash flow for 2025, and gave a preliminary free cash flow target of $2.4 billion for 2026. It also said it will pause dividend growth for now, while continuing to pay dividends at current levels. The dividend stock has laid out a plan to phase out its discounted dividend reinvestment program from 2026. That reads like a dividend stock looking to get its balance sheet under control, not a stock looking to win a popularity contest.

In short

So why call TELUS the dividend stock every investor should own when the stock is down? Because the market has already priced in a lot of the frustration, and you’ll still get a big return while the dividend stock works through its deleveraging plan. Right now, this is what the dividend stock could earn from even $7,000.

COMPANY	RECENT PRICE	NUMBER OF SHARES	DIVIDEND	ANNUAL TOTAL PAYOUT	FREQUENCY	TOTAL INVESTMENT
T	$18.52	378	$1.67	$631.26	Quarterly	$6,998.56

However, the risks remain real, especially debt, competition and the fact that high interest rates can indicate stress. If you can handle a few turbulent months and want an income you can really feel, TELUS makes a strong case at these levels.