TELUS (TSX:T) remains one of the few options when it comes to wireless providers in Canada. Because of this, it continues to be a household name when considering both a new provider, as well as a new investment.
Yet, after climbing through the pandemic, Telus stock is now down 12% in the last year alone. On the surface, this might mean you want to stay away from the stock. But long-term investors may want to rethink this, especially with a 5.12% dividend yield to consider.
The climb and the fall
Telus stock had a major advantage going into the pandemic. The telecommunications company had much of its 5G infrastructure already up and running, providing users with some of the fastest network speeds in Canada!
This proved valuable during a time when remote work became a necessity. Many switched over to access those high speeds. And Telus managed to gain more and more clients as the months wore on.
However, after the pandemic restrictions were lessened, Telus stock started to drop. Especially in 2021, when not only did the markets drop but its peers also got their 5G infrastructure up and running. Now, Telus stock is no longer in the top spot for internet speeds.
So should you avoid it?
In short, no. That’s because this is a blip in the long history of Telus stock. There will be continued evolutions in internet speeds, with 5G just the most recent. Because of this, you can be quite sure that Telus stock will climb back upwards.
Therefore, right now looks like a great time to consider Telus stock while it’s down. Shares are down 12% in the last year, providing you with value in terms of share price. Further, T trades at just 2.4 times book value, and again it offers that 5.12% dividend yield for while you’re waiting.
What’s more, you can also look at Telus stock’s historical performance when considering how it should do during this economic downturn. In the past 20 years alone, shares are up 542%. That comes to a compound annual growth rate (CAGR) of 8%.
As for the dividend, it has performed similarly. In the last decade alone, investors have enjoyed dividend growth at a CAGR of 8.3%. So these are certainly factors to consider.
Telus stock is a tried-and-true option for those seeking long-term wealth. While in the short term it may struggle to get back to the top, in the long term investors should be quite happy with the company’s performance.
In fact, Telus stock continues to make announcements regarding future products, partnerships, and awards on a regular basis. Any one of these announcements could see shares climb back upwards once more.
However, what’s far more stable is the realization that when the market recovers – and it will recover –Telus stock is likely to rebound during that time. And from there, it’s likely to continue that recovery to the point where you’ll be happy for that 12% discount.