Are you tired of paying exorbitant amounts for your phone and internet? Are those overage charges putting a dent in your wallet?
Although I cannot help you negotiate a better rate for your phone and internet plans, I can recommend that you buy Québecor (TSX:QBR.B)(TSX:QBR.A), which is the fifth-largest telecommunications company in Canada with returns of 595% since its IPO.
Québecor is French to its core, founded in 1965 by Pierre Péladeau and headquartered in Montréal, Québec. In 2012, shareholders voted to add the acute accent to Quebecor, making it Québecor.
The company dominates the Québec telecommunications industry, capturing 38.3% of the market as of March 31, 2019, up from 12% in FY 2013.
Québecor has outperformed the S&P/TSX Composite since the index’s inception by a factor of 13 times, and here is why it will continue to be successful.
Growing net income
Although you would be hard-pressed to find a struggling telecommunications company in Canada, Québecor’s management team is noteworthy due to its ability to grow the bottom line.
From FY 2014 to FY 2018, Québecor’s net income increased year over year (YOY ) from a $30 million loss in FY 2014 to a $402 million gain in FY 2018.
This has resulted in an accumulated net income of $1.1 billion over a short period of five years!
But that’s not all… The company’s Q1 2019 net income on an annualized basis would result in profits of $508 million for FY 2019, up from $402 million in FY 2018 — a gain of 26%.
Picture this: if you’d bought $10,000 of Québecor stock in January 2014 and held it until today, your portfolio would be worth $23,065! Yes, you read that right — gains of $13,065!
Not to be cliché, but the jingle, “it’s better in the Bahamas” is true, especially when you can pay for a vacation three times over.
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French to its core
Language is a big part of the Québec culture, which is why Québecor has been so successful to date.
The company is the owner of Le Canal Nouvelles (LCN), a 24-hour French language news channel. According to the company, LCN is “by far Québec’s most‑watched specialty channel,” which has allowed the company to position itself as the go-to telecommunications company for the Québécois.
Québecor is also the sole owner of the integrated telecommunications company Videotron, which is a company that specializes in serving Québec, Francophone communities in New Brunswick, and parts of Eastern Canada.
The bottom line
There is literally no other stock on the market like Québecor.
With net income that has increased YOY since FY 2014 and a company synonymous with Québec culture, Québecor is a true gem.
The company has consistently beat the S&P/TSX Composite and has gains of 595% since its IPO. It also dominates the Québec telecommunications industry with 38.3% of the market share.
Simply put, you would be foolish not to invest.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Chen Liu has no position in the companies mentioned.