TELUS (T) — 55% dividend reset and a deleveraging plan; ~6% yield on the new rate

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The short version: the income story has been reset

TELUS Corporation (TSX: T), one of Canada’s three national wireless and broadband carriers, traded near CA$12.60 on the September 12, 2026 screener, down about 43% over twelve months, about 24% over three months and about 30% year to date. On July 31, under new CEO Victor Dodig, TELUS cut its dividend by about 55%, booked a large second-quarter loss and lowered guidance. The new story is a balance-sheet and capital-allocation reset, not a sleepy high-yield telecom.

The screener still showed a trailing yield of about 13%, but that number is stale: the new C$0.75 annual rate works out to about 6% on the current price. With the stock near 17x forward earnings, the question for a new buyer is whether the reset marks the bottom of a long re-rating or just the start of a slower repair. Below we go through the dividend cut, the Q2 print and guidance, and how TELUS compares with its closest TSX telecom peers — BCE, Rogers and Quebecor — on size, returns, valuation, dividends and analyst ratings.

What happened: a 55% dividend cut and a new capital plan

On July 31, 2026, alongside its second-quarter results, TELUS reset its capital-return policy under Victor Dodig. The reset brings:

• a quarterly dividend of C$0.1875, or C$0.75 annualized, down from about C$1.67 — a cut of about 55%,
• about C$2.7B of cumulative cash savings through 2028, earmarked for debt reduction,
• the end of the DRIP discount from October 1, 2026, which means less dilution from discounted share reinvestment,
• a new free-cash-flow payout band of 45–60%, down from 60–75%.

For income investors who owned TELUS for the yield, the math changed overnight. For the company, the reset frees cash to repair a stretched balance sheet: net debt sits at 3.5x adjusted EBITDA, and management now targets 3.0x or lower by the end of 2028 — a timeline pushed back from 2027. Asset sales in the non-core Health business and real estate are also under way. This is a repair plan, not a growth plan, at least for the next two years.

The Q2 print and the guidance cut

The quarter behind the reset was weak:

• Net loss of about C$1.8B, or about −C$1.17 per share, mostly from a roughly C$2.1B non-cash impairment on TELUS Digital.
• Adjusted EPS of C$0.16, still positive but down 27% year over year.
• Mobile network revenue up 1% to about C$1.7B, with ARPU of C$56.36 (down 0.4%).
• Phone net additions of only 17,000 and internet net additions of 20,000, while TELUS Digital revenue declined.

Guidance came down too. For 2026, TELUS now expects service revenue flat to down 2%, adjusted EBITDA down 2% to 4%, Cap-X around C$2.6B and free cash flow near C$1.8B, down from about C$2.45B before. The lower free cash flow outlook helps explain why the dividend had to move.

Business overview: TELUS vs Canadian telecom peers

TELUS sells wireless plans, fibre internet (its PureFibre network) and TV and home services across Canada, with a strong base in Western Canada. It also owns TELUS Health and TELUS Digital, the customer-experience and IT-services arm that drove the Q2 writedown. The steady part is the subscription base of wireless and home-internet customers; the swing factors are wireless pricing, population growth and the non-core Digital and Health businesses. Dodig’s three priorities are a stronger financial foundation, operational discipline, and profitable growth in wireless, fibre and AI infrastructure.

On the TSX screener, TELUS sits in the Communications sector. Bell (BCE) is the largest Canadian carrier and went through its own dividend reset earlier. Rogers (RCI.A) is the biggest wireless operator and the closest competitor nationally. Quebecor (QBR.A), through Videotron and Freedom Mobile, is the fourth national player and the fastest-growing of the group. Smaller and illiquid names in the sector were left out.

Overview table

Company (Ticker)	Price	Market cap	Revenue (LTM)	Net income (LTM)
TELUS (T)	$12.60	$20.0B	$20.2B	−$919M
Bell (BCE)	$32.39	$30.2B	$24.8B	$6.42B
Rogers (RCI.A)	$50.54	$27.1B	$22.6B	$6.17B
Quebecor (QBR.A)	$63.61	$14.1B	$5.79B	$944M
Average (incl. T)	—	$22.9B	$18.4B	$3.15B

Source: TSX screener (September 12, 2026, tsx-2026-09-12.csv) · CAD · LTM = last 12 months. Average includes T; blank cells skipped.

TELUS is the third-largest of the four by market value at about C$20.0B, with C$20.2B of trailing revenue — similar to Rogers and BCE in scale but worth roughly a quarter to a third less. The difference is profit: TELUS shows a trailing net loss of about C$919M after the Digital writedown, while BCE and Rogers report more than C$6B each (both helped by one-time items).

Performance: a long, grinding re-rating

Performance table

Company (Ticker)	1M	3M	6M	1Y	5Y	10Y
TELUS (T)	−5.6%	−24.4%	−30.0%	−42.8%	−57.0%	−40.6%
Bell (BCE)	0.0%	−5.8%	−7.8%	−3.4%	−51.5%	−47.4%
Rogers (RCI.A)	−0.8%	−7.6%	−6.3%	−0.9%	−19.1%	−8.3%
Quebecor (QBR.A)	−3.5%	−8.4%	+7.9%	+47.7%	+102%	+224%
Average (incl. T)	−2.5%	−11.6%	−9.1%	+0.2%	−6.3%	+31.9%

Source: TSX screener (September 12, 2026). Average includes T; blank cells skipped. Price change by window.

Over twelve months TELUS is down about 43%, against roughly flat BCE and Rogers and a 48% gain for Quebecor. Over one month TELUS lost about 6% and over three months about 24%, the worst in the group on both windows. This is stock-specific, not a sector move: investors have been selling TELUS for its leverage and dividend risk while rewarding Quebecor’s growth.

Over longer windows TELUS is down about 57% in five years and 41% in ten. BCE has a similar five-year decline, while Quebecor is up more than 200% over ten years. For a stock many Canadians hold for income, that is a long, grinding re-rating.

Valuation: cheap on sales and cash flow, not on earnings

Valuation table

Company (Ticker)	P/E	Fwd P/E	PEG	P/S	P/B	P/FCF	Price/Cash
TELUS (T)	—	16.92	—	0.98	1.49	9.14	14.30
Bell (BCE)	4.82	12.96	0.003	1.21	1.46	11.37	63.06
Rogers (RCI.A)	4.44	10.66	0.015	1.21	1.65	9.95	15.81
Quebecor (QBR.A)	15.58	13.99	0.69	2.53	5.19	9.34	118
Average (incl. T)	8.28	13.63	0.23	1.48	2.45	9.95	52.69

Source: TSX screener (September 12, 2026). Average includes T; blank cells skipped. Highlighted = lowest (cheapest) positive value per column. TELUS P/E and PEG are blank (negative trailing earnings); BCE’s and Rogers’ trailing P/E and PEG look unusually low because trailing earnings include large one-time items (PEG shown to 3 decimals).

TELUS has no meaningful trailing P/E, because trailing earnings are negative (about −C$0.57 per share). On forward earnings it trades near 17x, the highest in the group against a 13.6x average; Rogers is cheapest at about 10.7x. That premium reflects depressed near-term earnings, not optimism.

On cash and sales, TELUS screens cheapest: about 1.0x price to sales, about 9.1x price to free cash flow and the lowest price to cash. Trailing free cash flow was still about C$2.17B (a margin near 10.7%), with debt to equity of about 2.4. The catch is that the trailing figure is higher than the C$1.8B guided for 2026, so the P/FCF multiple looks better than forward cash flow may justify. If earnings stabilize and Cap-X falls as the PureFibre build winds down, the forward P/E should come down too.

Dividend: about 6% on the new rate

Dividends table

Company (Ticker)	Dividend / share	Yield	Payout ratio
TELUS (T)	$0.75	5.95%	—
Bell (BCE)	$1.75	5.40%	26.0%
Rogers (RCI.A)	$2.00	3.96%	17.5%
Quebecor (QBR.A)	$1.40	2.83%	36.1%
Average (incl. T)	$1.48	4.54%	26.5%

Source: TSX screener (September 12, 2026), except TELUS. Average includes T; blank cells skipped. Yield = indicated. TELUS = new annualized rate from its July 31, 2026 release (C$0.1875 quarterly), yield = C$0.75 ÷ C$12.60; the screener’s C$1.65 / 13.2% figures predate the cut. BCE = current quarterly rate annualized (the screener’s C$2.31 annual DPS predates its reset). Payout = trailing 12 months; TELUS blank (negative earnings).

After the reset, TELUS pays C$0.75 a year (C$0.1875 a quarter), for a yield of about 6% on C$12.60 — still the highest in the group, ahead of BCE at about 5.4%, Rogers near 4.0% and Quebecor near 2.8%. The screener’s trailing yield of about 13% reflects the old payout and no longer applies. A payout ratio on earnings isn’t meaningful while TELUS reports a loss; the company now targets paying out 45–60% of free cash flow. The yield is lower but the dividend now sits on firmer ground — the question is whether income holders who bought for the old yield keep selling.

Analyst view: the Street is cautious on TELUS

Analyst table

Company (Ticker)	Rating	Price	Target 1Y	Upside	Analysts
TELUS (T)	Neutral	$12.60	—	—	—
Bell (BCE)	Buy	$32.39	—	—	—
Rogers (RCI.A)	Buy	$50.54	—	—	—
Quebecor (QBR.A)	Buy	$63.61	—	—	—
Average (incl. T)	—	—	—	—	—

Rating & price: TSX screener (September 12, 2026). Target 1Y, Upside and Analysts are blank: no consensus targets were pulled for the TELUS video, and the screener has no target column.

The screener rates TELUS a Neutral, while BCE, Rogers and Quebecor all carry Buy ratings — a sign that the Street wants proof the reset works before turning positive. The TELUS video did not cite price targets, so the target columns are blank. For reference, the MarketBeat consensus shown in our BCE briefing a week later (September 18) put TELUS’s average target near C$14.30, about 15% above that day’s C$12.47 price.

Why it matters: from sleepy high-yield telecom to balance-sheet reset

The old narrative was TELUS as a sleepy high-yield telecom: a dependable, growing dividend backed by wireless and fibre. The new narrative is a balance-sheet and capital-allocation reset: cut the payout, end the DRIP discount, write down Digital, lower free cash flow guidance and push leverage repair out to 2028.

DIY investors who owned TELUS for the dividend need to redo the math at C$0.75. Growth and quality investors need to decide whether Dodig’s three priorities can re-rate the stock after a multi-year drawdown. The open question is whether the cut is enough — or whether further asset sales and restructuring are needed to hit 3.0x leverage.

Bull case

1. Clear deleveraging plan. About C$2.7B of cash savings through 2028 and an explicit target of 3.0x net debt to EBITDA.
2. Core network still growing. Mobile network revenue rose 1%, and the PureFibre build nearing completion should mean lower capital intensity later.
3. Not a nosebleed valuation. About 1.0x sales, 1.5x book and 17x forward earnings, with trailing free cash flow near C$2.17B and a more conservative 45–60% payout band.

Bear case and risks

1. Trust shock. A dividend cut, a guidance cut and a C$2.1B impairment in one quarter may keep income holders selling.
2. Competitive wireless. Price competition and slower population growth are compressing ARPU (down 0.4%) and net adds (17,000 phones).
3. Leverage still high. At 3.5x, the path to 3.0x depends on free cash flow, lower Cap-X and asset sales actually closing.

What to watch

1. Stabilization. Whether the stock finds a floor after digesting the 55% reset.
2. The November capital-returns update that Dodig flagged alongside Q3 results.
3. Leverage and asset sales. Progress toward 3.0x and any proceeds from Health or real-estate monetization.
4. Wireless competition. ARPU, churn and net adds versus Rogers and BCE, plus whether TELUS Digital turns around or needs more restructuring.

Bottom line

TELUS has done the hard thing: it cut the dividend, ended the discounted DRIP and set out a clear deleveraging target under a new CEO. That makes the dividend more sustainable, but it also wrote down Digital, lowered guidance and pushed the leverage goal out to 2028. The issue is trust and execution more than price. At about 17x forward earnings and roughly 1x sales after a 43% one-year fall, the stock prices in a lot of bad news, yet the Street still rates it only Neutral. The next test is the November capital-returns update and whether free cash flow holds near the C$1.8B guide.

Video chapters

• 0:00 Hook — dividend cut 55%
• 0:24 Q2 news: C$1.8B loss and Digital impairment
• 0:47 Guidance cut and leverage path
• 1:16 Operations snapshot
• 1:39 Screener tape (September 12)
• 2:05 Fundamentals and the new yield math
• 2:39 Why it matters
• 3:03 Bull case
• 3:39 Bear case
• 4:05 What to watch

Data notes

Table figures are TSX screener values (merge tsx-2026-09-12.csv, 2,554 rows; CAD). The TELUS video had no peer tables, so these were built for this post from the same merge the video used. Peers are liquid same-sector (Communications) carriers: BCE (largest carrier), Rogers (largest wireless operator) and Quebecor (fourth national player) — the same set as our BCE briefing; smaller and illiquid names were skipped. Average rows include T and skip blank cells. The TELUS dividend uses the new C$0.75 annual rate from its July 31, 2026 release (yield = C$0.75 ÷ C$12.60) because the screener’s C$1.65 trailing DPS and 13.2% yield predate the cut; BCE’s uses its current quarterly rate annualized. No consensus price targets were pulled for this video and the screener has no target column, so Target 1Y, Upside and Analysts are blank; the C$14.30 reference comes from the September 18 BCE briefing. Q2, guidance and dividend figures are from TELUS’s July 31, 2026 release. Video chapter times come from the rendered video’s section timings.

Sources

• TELUS Q2 2026 results and capital-allocation update, July 31, 2026 (company release / PR Newswire)
• Globe and Mail and Toronto Star reporting on the TELUS dividend reset (July–August 2026)
• MarketBeat — TELUS consensus target as shown in the StockSummarizer BCE briefing (September 18, 2026)
• TSX screener merge September 12, 2026 (2,554 rows)

Media credits

TELUS logo (company trademark, used for identification). The video’s data cards and charts were built in-house; no photos were used. No AI-generated images were used.

By Andrew · stocksummarizer.com