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Earn 1,000% Returns From This Safe, High-Growth Stock!

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TELUS (TSX:T)(NYSE:TU) is one the largest telecommunications companies in Canada. In fact, there is very little room to move in on the company, along with its peers, in our country. It operates through wireless and wireline segments, providing services and products to 15.4 million customers across the country.

Performance

Telus has a price-to-earnings ratio of 27.9, a price-to-book ratio of 2.8, a dividend yield of 4.7%, and a market capitalization of $34 billion. The company has a solid return on equity of 10.83% in the last year, and relative strength index of 44 as of writing.

This solid performance comes from Telus investing in wireline before the pandemic hit. The other two top competitors are still trying to play catch up, while also trying to stay afloat during a pandemic. While another competitor could come in one day, with the pandemic in play, it will likely be many years ahead before that can even be considered.
This investment did mean the company took on debt and now has a total debt over earnings before interest, taxes, depreciation, and amortization (EBTIDA) of 4.1 as of writing, which is a bit of a red flag. Yet management doesn’t seem concerned, and that comes from the continued solid performance in revenue.
Revenue came in at a 5% year-over-year increase during the latest earnings report, with the company so far not losing any revenue during the pandemic! Now that the investment has been made, and it will take years for competitors to catch up, investors can look forward to further solid revenue growth with no expenses for investing in infrastructure.

International

The company recently had its initial public offering (IPO) for TELUS International, which focuses more on the technology aspect of its online presence. The company actually broke the record for the largest tech IPO in TSX history! This international expansion gives investors even more opportunity to see high growth from this stock.

With media, health care, financial services, e-commerce, gaming, and more under its radar, the company has the means to see high growth during this next decade, as more services become online. And again, the stock is ahead of its competitors that are still playing catch up to create the fast wireline services offered by Telus — especially now that it’s become an internationally known company.

Bottom line

Just look at the history of Telus stock for an idea of how far you could grow from this stock. Shares are up 475% in the last two decades for a compound annual growth rate (CAGR) of 9.14%. If you’re a long-term holder of Telus stock buying this as a millennial, you could see around 1,000% in returns by the time you retire — especially if you reinvest dividends! Yet it’s likely that this stock will soar even higher in the years to come, as the other companies continue to try and put in wireline for 5G.

Meanwhile, you can look forward to years of solid dividends from this company with a payout history of over two decades, reinvesting as you go.

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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 Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends TELUS CORPORATION.

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