Choosing between TELUS (TSX:T) stock and Rogers Communications (TSX:RCI.B) stock for a retirement portfolio isn’t as simple as picking the bigger brand or the shinier dividend yield. Both companies dominate Canada’s telecom landscape, yet their strategies, financial profiles, and shareholder return policies diverge meaningfully—enough to leave investors second-guessing.
TELUS dangles a fat 7.4% dividend yield and a track record of consistent payout hikes, while Rogers boasts industry-leading margins and a growth engine fueled by sports media and infrastructure deals. So, which stock deserves a spot in your retirement portfolio? Let’s dissect the numbers, the narratives, and the nuances.
The earnings divide: Growth vs current income
TELUS closed 2024 with a bang, adding 328,000 telecom customers in the fourth quarter alone—its third straight year surpassing one million net additions. This wasn’t just volume; it was profitable growth. The company’s postpaid mobile churn stayed below 1% for the 11th consecutive year, and its emerging businesses—Telus Health and Agriculture—delivered double-digit revenue growth. Free cash flow hit $2.0 billion in 2024, up 12% year over year.
Management’s confidence shines through its dividend policy: a 7% raise for 2025, with plans to update its 2026-2028 dividend-growth program in May. For passive-income seekers, TELUS stock isn’t just paying dividends; it’s banking on them as a cornerstone of total shareholder returns.
Rogers Communications, meanwhile, flexed its operational muscle in 2024. It added 623,000 wireless and internet subscribers—the most in Canada—and its wireless earnings before interest, tax, depreciation, and amortization (EBITDA) margin hit a sky-high 66%. The Shaw acquisition continues to bear fruit, with a $7 billion wireless infrastructure deal and MLSE sports stake expansion, its shareholder returns rely more on capital gains than cash distributions.
The “bird-in-hand” theory: Why TELUS stock’s dividend demands attention
For retirees, predictable income often trumps speculative growth. This is where TELUS stock’s 7.4% yield—240 basis points above Rogers’s—becomes compelling.
The “bird-in-hand” theory argues that “guaranteed” dividends are less risky than uncertain capital appreciation. TELUS’s commitment to this philosophy is ironclad: 27 dividend increases since 2011 and a multiyear plan to reduce debt while growing dividend payouts. Even with moderating capital expenditures, TELUS’s free cash flow trajectory supports its dividend ambitions.
Rogers isn’t ignoring shareholder returns—it grew free cash flow by 26% in 2024—but its priorities differ. The company is funnelling capital into network upgrades and debt reduction. While these moves could drive long-term equity upside, they leave less room for dividend aggressiveness. Rogers stock’s 5% dividend yield is respectable, but its payout growth has been sporadic, with no explicit multiyear guidance. For retirees, that uncertainty matters.
TELUS’s total return eclipsed Rogers’s during the past five years.
RCI.B Total Return Price data by YCharts
Since capital gains are more illusive than dividend yields, TELUS stock’s outperformance may persist in 2025.
Valuation and risk: The hidden trade-offs
TELUS stock trades at 21.3 times forward earnings—a premium to Rogers’s 8.25—reflecting its perceived stability and dividend allure. But that premium isn’t unwarranted. TELUS’s diversification (healthcare, agriculture, and technology via Telus Digital) insulates it from telecom volatility, while Rogers’s fortunes hinge on highly cyclical sectors like advertising and sports.
Rogers stock’s lower valuation multiples signal market skepticism about its debt-heavy balance sheet and integration risks post-Shaw acquisition. Its $7 billion infrastructure monetization plan could ease leverage, but delays or execution missteps loom as risks.
TELUS, meanwhile, faces its own challenges: Average revenue per user (ARPU) declines and regulatory pressures. Yet its defensive qualities—high-margin internet services, some sticky healthcare contracts—soften these blows.
Investor takeaway: Income security vs growth optionality
TELUS stock and Rogers Communications stock cater to different investor psyches. If you prioritize steady, growing passive income and can stomach a richer valuation, TELUS’s 7.4% yield and dividend consistency are hard to ignore. Its upcoming 2026-2028 payout roadmap could further cement its income credentials.
Rogers appeals to those betting on operational excellence and valuation multiple expansions. Its industry-leading margins, sports/media upside, and infrastructure deals offer growth levers—but require patience and tolerance for execution risk.
In personal retirement portfolios, where capital preservation and cash flow reign supreme, TELUS’s bird-in-hand dividends might just clinch the deal.
