For Canadians focused on steady income and defensive investing, few stocks are more dependable than a telecom. And when that telecom pays a dividend above 7%, it’s hard not to pay attention. TELUS (TSX:T) is one of those names that continues to deliver payouts even in uncertain times. If I were putting my entire Tax-Free Savings Account (TFSA) to work today, TELUS would be a top contender. It’s stable, essential, and offering the kind of yield that could power a portfolio for years.
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About TELUS
TELUS operates in one of the most recession-resistant industries out there –communications. People need phone, internet, and increasingly, connected health services, regardless of economic conditions. That’s a big part of what gives TELUS its defensive edge. But what makes it even more appealing now is the dividend, which as of recent trading, sits around 7.6%. At a share price of about $22.50, that translates to an annual payout of $1.67 per share.
In its most recent earnings report, TELUS posted revenue of $4.9 billion in the first quarter of 2025. That’s up 1.9% from the year before. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at $1.7 billion, reflecting a 4.5% increase. Net income rose sharply to $376 million, or $0.25 per share, up from just $217 million, or $0.14 per share, last year. That’s a big jump, driven by better operational efficiency and growth in both core telecom and TELUS Health.
While wireless and internet remain the bread and butter, the real story continues to be TELUS Health. That segment saw revenue jump 20% year over year, thanks to expanding services across Canada and internationally. TELUS now reaches over 55 million lives through its digital health offerings, and that number keeps growing. It’s not just a side business anymore; it’s a serious driver of growth that differentiates TELUS from its peers.
Considerations
One reason investors have been hesitant with TELUS in recent months is debt. Like most telecoms, TELUS carries a hefty debt load. But it’s also investing in essential infrastructure, like 5G networks and fibre, to ensure long-term competitiveness. Capital expenditures were trimmed in the latest quarter, part of the company’s plan to return to positive free cash flow in the second half of 2025. That’s worth watching, but not panicking over. TELUS has a long track record of prudent financial management.
Despite the debt, TELUS continues to raise its dividend regularly. The most recent hike was 3.9%, marking the 25th consecutive year of dividend growth. That kind of consistency is rare, and it’s the kind of foundation that suits a TFSA perfectly. All those dividend payments are tax-free when sheltered inside a TFSA, and when reinvested, they can quietly compound into something substantial over time.
Now, could there be a downside? Absolutely. Rising interest rates increase borrowing costs, and any significant economic slowdown could impact customer growth. TELUS also operates in a highly regulated environment, and any shift in policy could affect its pricing power. But those risks are part of the telecom landscape, and TELUS has weathered them all before.
Bottom line
If I were putting my entire TFSA to work today, a $7,000 investment would buy around 311 shares of TELUS. That would generate roughly $519 in annual tax-free income right out of the gate. And that’s assuming no dividend hikes, no capital appreciation, and no reinvestment. Add those factors in, and the numbers only get better.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| TELUS | $22.50 | 311 | $1.67 | $519.37 | Quarterly | $6,997.50 |
At a time when many Canadians are looking to fund day-to-day spending or offset rising costs, steady income matters more than ever. TELUS offers that, plus a growth angle through digital health and smart infrastructure. It’s not a flashy stock, but it’s one that just keeps showing up, quarter after quarter, with reliability and income.
For a TFSA designed to grow quietly in the background while generating real monthly like income, TELUS checks all the boxes. It’s boring in the best possible way, and that’s exactly what makes it such a compelling pick right now.
