The Motley Fool

Top Telecom Stock to Buy in August 2021

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TELUS (TSX:T)(NYSE:TU) is a wonderful company that sets meaningful social and financial targets. Socially, TELUS’s 2021 targets included inspiring employees to engage in 1.25 million safe acts of giving, including contributing 175,000 days of volunteerism for the year. TELUS also has continually expanded and amplified several of the company’s programs.

Early-stage financing to purpose-driven companies and entrepreneurs

Collectively, TELUS contributed over $85 million to charitable and community organizations and fundraised $3 million for the company’s foundation. TELUS also plans to disburse $20 million in early-stage financing to purpose-driven companies and entrepreneurs through the company’s fund.

Greenhouse gas reduction

In addition, having surpassed its own 2020 goals in energy and greenhouse gas reduction, TELUS is now focused on procuring 100 percent of the company’s electricity requirements from renewable or non-emitting sources by 2025, enabling the company’s operations to be net carbon neutral by 2030 and attaining a 50 percent improvement in energy efficiency over 2020 levels by 2030.

Robust free cash flow

Financially, TELUS’s targets for 2021 include growth in revenue of up to 10 percent and earnings of up to eight percent. TELUS also expects robust free cash flow of approximately $1.5 billion. In fiscal 2020, TELUS’s wireline financials were driven by data revenue growth of 20 per cent.

Better and faster rural experience

Opensignal, based in the U.K., confirmed that the rural experience on TELUS’s network is better and faster than in any location within the G7 nations, with the exception of Japan, a much smaller country than Canada, which at 49 megabytes per second (Mbps) was only slightly faster than TELUS’s 48 Mbps. Opensignal appeared to suggest that rural Canadian users, on average, were seeing faster 4G download speeds than users in Sweden, New Zealand, France and 73 of the other countries it reported on.

Faster wireless speeds

In fact, wireless speeds available in rural Canada exceed those of any region in the entire U.S. Clearly, Canadians appear to count on TELUS for wireless access. TELUS’s award-winning wireless network is supported by globally leading fibre infrastructure that enables the vital connections required to keep the company’s citizens and communities connected and productive, while also providing the backbone for a 5G-enabled world.

Receiving international recognition

By the end of 2020, 2.5 million households and businesses were connected to TELUS PureFibre across 137 communities in the company’s broadband footprint. Like TELUS’s wireless network, the company’s PureFibre network also continues to receive international recognition. Notably, U.S.-based PCMag ranked TELUS’s PureFibre network as Best for Gaming in 2020 and recognized TELUS as the fastest internet service provider nationally. In addition, TELUS PureFibre is the only internet service in Canada to receive a perfect performance score on the Netflix Speed Index for six consecutive months.

Profound impact on communities

Furthermore, TELUS’s ability to do well and do good in the company’s communities continues to have a profound impact on the lives of citizens worldwide. Over the course of a challenging year, TELUS dedicated $150 million in support of COVID-19 relief efforts to build public healthcare capacity and assist vulnerable communities.

Overall, TELUS appears to be a great buy at current market prices. The company is highly profitable and possibly undervalued here.

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.

The Motley Fool recommends TELUS CORPORATION. Fool contributor Nikhil Kumar has no position in any of the stocks mentioned.

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