TELUS CORP (TU) Stock Fundamental Analysis
USA - NYSE:TU - CA87971M1032 - Common Stock
14.77 USD
-0.03 (-0.2%)
14.77 USD
0 (0%)
TU gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 36 industry peers in the Diversified Telecommunication Services industry. There are concerns on the financial health of TU while its profitability can be described as average. TU has a expensive valuation and it also scores bad on growth. Finally TU also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
TU had positive earnings in the past year.
TU had a positive operating cash flow in the past year.
TU had positive earnings in each of the past 5 years.
Each year in the past 5 years TU had a positive operating cash flow.
1.2 Ratios
TU has a Return On Assets of 1.59%. This is in the better half of the industry: TU outperforms 61.11% of its industry peers.
With a decent Return On Equity value of 6.35%, TU is doing good in the industry, outperforming 69.44% of the companies in the same industry.
The Return On Invested Capital of TU (4.96%) is better than 61.11% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TU is in line with the industry average of 6.52%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.59% | ||
| ROE | 6.35% | ||
| ROIC | 4.96% |
ROA(3y)2.07%
ROA(5y)2.49%
ROE(3y)7.11%
ROE(5y)8.46%
ROIC(3y)5.16%
ROIC(5y)5.5%
1.3 Margins
With a decent Profit Margin value of 4.73%, TU is doing good in the industry, outperforming 63.89% of the companies in the same industry.
In the last couple of years the Profit Margin of TU has declined.
TU has a better Operating Margin (15.78%) than 72.22% of its industry peers.
TU's Operating Margin has declined in the last couple of years.
TU has a better Gross Margin (62.94%) than 63.89% of its industry peers.
TU's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.78% | ||
| PM (TTM) | 4.73% | ||
| GM | 62.94% |
OM growth 3Y-6.27%
OM growth 5Y-5.58%
PM growth 3Y-20.54%
PM growth 5Y-16.25%
GM growth 3Y1.26%
GM growth 5Y1.39%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TU is destroying value.
The number of shares outstanding for TU has been increased compared to 1 year ago.
Compared to 5 years ago, TU has more shares outstanding
The debt/assets ratio for TU is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.92, we must say that TU is in the distress zone and has some risk of bankruptcy.
TU has a Altman-Z score of 0.92. This is comparable to the rest of the industry: TU outperforms 55.56% of its industry peers.
TU has a debt to FCF ratio of 31.18. This is a negative value and a sign of low solvency as TU would need 31.18 years to pay back of all of its debts.
The Debt to FCF ratio of TU (31.18) is comparable to the rest of the industry.
TU has a Debt/Equity ratio of 1.88. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.88, TU is doing worse than 69.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 31.18 | ||
| Altman-Z | 0.92 |
ROIC/WACC0.9
WACC5.5%
2.3 Liquidity
A Current Ratio of 0.86 indicates that TU may have some problems paying its short term obligations.
TU has a worse Current ratio (0.86) than 75.00% of its industry peers.
A Quick Ratio of 0.81 indicates that TU may have some problems paying its short term obligations.
The Quick ratio of TU (0.81) is worse than 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
The earnings per share for TU have decreased by -5.84% in the last year.
TU shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -6.24% yearly.
TU shows a small growth in Revenue. In the last year, the Revenue has grown by 0.67%.
Measured over the past years, TU shows a small growth in Revenue. The Revenue has been growing by 6.66% on average per year.
EPS 1Y (TTM)-5.84%
EPS 3Y-0.32%
EPS 5Y-6.24%
EPS Q2Q%-14.34%
Revenue 1Y (TTM)0.67%
Revenue growth 3Y6.15%
Revenue growth 5Y6.66%
Sales Q2Q%2.59%
3.2 Future
Based on estimates for the next years, TU will show a small growth in Earnings Per Share. The EPS will grow by 6.47% on average per year.
Based on estimates for the next years, TU will show a small growth in Revenue. The Revenue will grow by 4.01% on average per year.
EPS Next Y-1.22%
EPS Next 2Y4.12%
EPS Next 3Y5.16%
EPS Next 5Y6.47%
Revenue Next Year2.91%
Revenue Next 2Y2.82%
Revenue Next 3Y2.94%
Revenue Next 5Y4.01%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 21.41 indicates a rather expensive valuation of TU.
TU's Price/Earnings ratio is in line with the industry average.
TU is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.28, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 18.48, the valuation of TU can be described as rather expensive.
66.67% of the companies in the same industry are more expensive than TU, based on the Price/Forward Earnings ratio.
TU's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 33.61.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.41 | ||
| Fwd PE | 18.48 |
4.2 Price Multiples
TU's Enterprise Value to EBITDA is on the same level as the industry average.
TU's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.12 | ||
| EV/EBITDA | 8.42 |
4.3 Compensation for Growth
The decent profitability rating of TU may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y4.12%
EPS Next 3Y5.16%
5. Dividend
5.1 Amount
TU has a Yearly Dividend Yield of 8.02%, which is a nice return.
Compared to an average industry Dividend Yield of 5.35, TU pays a better dividend. On top of this TU pays more dividend than 94.44% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, TU pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.02% |
5.2 History
The dividend of TU has a limited annual growth rate of 1.90%.
TU has been paying a dividend for at least 10 years, so it has a reliable track record.
TU has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)1.9%
Div Incr Years21
Div Non Decr Years21
5.3 Sustainability
TU pays out 163.46% of its income as dividend. This is not a sustainable payout ratio.
The dividend of TU is growing, but earnings are growing more, so the dividend growth is sustainable.
DP163.46%
EPS Next 2Y4.12%
EPS Next 3Y5.16%
14.77
-0.03 (-0.2%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners54.64%
Inst Owner Change-0.27%
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap22.67B
Revenue(TTM)20.14B
Net Income(TTM)966.00M
Analysts70.83
Price Target16.78 (13.61%)
Short Float %2.73%
Short Ratio11.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.02% |
Yearly Dividend0.75
Dividend Growth(5Y)1.9%
DP163.46%
Div Incr Years21
Div Non Decr Years21
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.24%
Min EPS beat(2)-6.86%
Max EPS beat(2)15.34%
EPS beat(4)3
Avg EPS beat(4)9.05%
Min EPS beat(4)-6.86%
Max EPS beat(4)16.54%
EPS beat(8)7
Avg EPS beat(8)7.57%
EPS beat(12)9
Avg EPS beat(12)2.47%
EPS beat(16)11
Avg EPS beat(16)1.47%
Revenue beat(2)0
Avg Revenue beat(2)-1.18%
Min Revenue beat(2)-1.38%
Max Revenue beat(2)-0.99%
Revenue beat(4)1
Avg Revenue beat(4)-0.62%
Min Revenue beat(4)-1.38%
Max Revenue beat(4)0.77%
Revenue beat(8)1
Avg Revenue beat(8)-2%
Revenue beat(12)1
Avg Revenue beat(12)-1.85%
Revenue beat(16)2
Avg Revenue beat(16)-1.97%
PT rev (1m)-0.42%
PT rev (3m)-0.35%
EPS NQ rev (1m)-3.51%
EPS NQ rev (3m)-8.58%
EPS NY rev (1m)-1.21%
EPS NY rev (3m)-0.67%
Revenue NQ rev (1m)-0.47%
Revenue NQ rev (3m)-0.62%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.41 | ||
| Fwd PE | 18.48 | ||
| P/S | 1.57 | ||
| P/FCF | 30.12 | ||
| P/OCF | 6.73 | ||
| P/B | 2.1 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.42 |
EPS(TTM)0.69
EY4.67%
EPS(NY)0.8
Fwd EY5.41%
FCF(TTM)0.49
FCFY3.32%
OCF(TTM)2.19
OCFY14.85%
SpS9.43
BVpS7.03
TBVpS-7.27
PEG (NY)N/A
PEG (5Y)N/A
Graham Number10.45
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.59% | ||
| ROE | 6.35% | ||
| ROCE | 6.48% | ||
| ROIC | 4.96% | ||
| ROICexc | 5.35% | ||
| ROICexgc | 15.69% | ||
| OM | 15.78% | ||
| PM (TTM) | 4.73% | ||
| GM | 62.94% | ||
| FCFM | 5.2% |
ROA(3y)2.07%
ROA(5y)2.49%
ROE(3y)7.11%
ROE(5y)8.46%
ROIC(3y)5.16%
ROIC(5y)5.5%
ROICexc(3y)5.26%
ROICexc(5y)5.61%
ROICexgc(3y)14.67%
ROICexgc(5y)15.27%
ROCE(3y)6.66%
ROCE(5y)7.09%
ROICexgc growth 3Y-6.18%
ROICexgc growth 5Y-3.5%
ROICexc growth 3Y-7.23%
ROICexc growth 5Y-7.25%
OM growth 3Y-6.27%
OM growth 5Y-5.58%
PM growth 3Y-20.54%
PM growth 5Y-16.25%
GM growth 3Y1.26%
GM growth 5Y1.39%
F-Score5
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 31.18 | ||
| Debt/EBITDA | 3.98 | ||
| Cap/Depr | 92.83% | ||
| Cap/Sales | 18.07% | ||
| Interest Coverage | 2.37 | ||
| Cash Conversion | 66.03% | ||
| Profit Quality | 109.94% | ||
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | 0.92 |
F-Score5
WACC5.5%
ROIC/WACC0.9
Cap/Depr(3y)107.1%
Cap/Depr(5y)125.25%
Cap/Sales(3y)21.07%
Cap/Sales(5y)24.41%
Profit Quality(3y)62.22%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.84%
EPS 3Y-0.32%
EPS 5Y-6.24%
EPS Q2Q%-14.34%
EPS Next Y-1.22%
EPS Next 2Y4.12%
EPS Next 3Y5.16%
EPS Next 5Y6.47%
Revenue 1Y (TTM)0.67%
Revenue growth 3Y6.15%
Revenue growth 5Y6.66%
Sales Q2Q%2.59%
Revenue Next Year2.91%
Revenue Next 2Y2.82%
Revenue Next 3Y2.94%
Revenue Next 5Y4.01%
EBIT growth 1Y1.03%
EBIT growth 3Y-0.51%
EBIT growth 5Y0.7%
EBIT Next Year150.71%
EBIT Next 3Y39.32%
EBIT Next 5Y23.7%
FCF growth 1Y490%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y10.41%
OCF growth 3Y3.37%
OCF growth 5Y4.3%
TELUS CORP / TU FAQ
What is the fundamental rating for TU stock?
ChartMill assigns a fundamental rating of 4 / 10 to TU.
Can you provide the valuation status for TELUS CORP?
ChartMill assigns a valuation rating of 3 / 10 to TELUS CORP (TU). This can be considered as Overvalued.
How profitable is TELUS CORP (TU) stock?
TELUS CORP (TU) has a profitability rating of 6 / 10.
Can you provide the financial health for TU stock?
The financial health rating of TELUS CORP (TU) is 1 / 10.
What is the expected EPS growth for TELUS CORP (TU) stock?
The Earnings per Share (EPS) of TELUS CORP (TU) is expected to decline by -1.22% in the next year.