A dividend stock down 24% gets attention fast. Sometimes that drop screams danger, but other times, it gives patient investors a better entry into a business they can hold for years. TELUS (TSX: T) falls into the second camp for me, even though investors shouldn’t pretend the risks have vanished.
The telecom sector has had a rough stretch. Higher interest rates hurt debt-heavy companies. Fierce wireless competition pressured prices. Investors also grew nervous about dividend safety across the industry after BCE‘s cut reset the conversation. TELUS stock didn’t escape that mood, with its share price far below its 52-week high, and the yield now looks unusually high for a blue-chip Canadian name.
That’s exactly why the stock looks interesting today.
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TELUS stock runs one of Canada’s largest wireless and internet networks. It serves households, businesses, health clients, digital clients, and agriculture customers. At its core, though, TELUS stock still does something simple. It connects people. Phones, internet, security, television, health records, and business services all feed into a larger customer relationship.
That kind of business can create recurring revenue, sticky customers, and steady cash flow. Those traits are important for dividend investors, especially when the stock already looks beaten up.
Numbers don’t lie
The latest quarter offered a mixed but useful picture. In the first quarter of 2026, TELUS stock generated $5 billion in operating revenue and other income, down slightly from last year. Service revenue rose 1%, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) stayed stable at $1.8 billion, and free cash flow climbed 19% to $583 million, which is highly important for dividend investors.
The company also added 262,000 total mobile and fixed customers. That included 21,000 internet customer additions and strong connected-device growth. Telus Health kept growing too, with service revenue and adjusted EBITDA each rising 11%. That gives the company more than just a classic telecom story.
The dividend remains the main attraction. TELUS stock declared a quarterly dividend of $0.4184 per share in May. That works out to $1.67 annually. At recent prices, the yield sits around 9.84%. Investors rarely see that kind of yield from a major Canadian telecom without serious concern baked in.
Considerations
Concerns do exist. TELUS stock carries a lot of debt, as most telecoms do. The dividend looks large compared with earnings, and competition could keep mobile pricing tight. TELUS stock also paused dividend growth while it focuses on free cash flow, debt reduction, and a healthier balance sheet. Investors who need fast dividend hikes may feel disappointed.
Still, I’d rather see management make that call than keep raising the payout just to protect a streak. TELUS stock expects free cash flow of about $2.45 billion in 2026 and targets at least 10% compound annual free cash flow growth through 2028. It also wants leverage down to 3.3 times or lower by the end of 2026 and three times or better by the end of 2027.
That plan won’t work overnight, but it gives investors a clear road map. Lower capital spending, cost cuts, AI-driven efficiency, and possible TELUS Health partnership proceeds could all help repair confidence. The sovereign AI factory push adds another modest growth angle, though investors shouldn’t treat it like a separate tech-stock thesis.
Bottom line
For long-term investors, the buy case comes down to trust in the cash flow. TELUS stock doesn’t need explosive growth to reward shareholders from here. It needs stable service revenue, better free cash flow, and discipline on debt. If it delivers, today’s ugly chart could age well, while investors collect income along the way. Plus, you’ll be collecting a solid dividend that can create income for years with just $7,000 invested.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| T | $17.06 | 410 | $1.67 | $684.70 | Quarterly | $6,994.60 |
I wouldn’t buy TELUS stock expecting a quick rebound, though. I’d buy it as a beaten-down dividend stock with durable assets, a huge yield, and a sensible plan to protect cash. Forever is a long time, but TELUS stock looks like one Canadian dividend stock worth holding through the noise.
