Balanced View on Telus - Analyst Blog
2014年1月14日 - 5:50AM
Zacks
On Jan 9, 2014 we maintained our
Neutral recommendation on Canadian telecom service provider
Telus Corporation (TU). We remain optimistic on
the company’s wireless segment, technology upgrade, post-paid
plans, increased rollout of smartphones and expansion of the 4G LTE
network. Furthermore, investments in Optik TV business and
high-speed broadband technology and services will likely work in
favor of Telus.
Nevertheless, continuous access
lines erosion along with competitive threats and increased capital
expenditures keep us cautious. Telus currently carries a Zacks Rank
#3 (Hold).
Why
Maintained?
Deeper penetration of smartphones,
improving churn, increasing average revenue per unit, accelerating
wireless data services and growing wireline fiber optic networks
are the catalysts for Telus’ growth. Launch of various rate plans,
in particular the high-end post-paid plans will improve the
financial performance of the company.
Expansion of 4G LTE network,
offering of the latest LTE based handsets and launch of SharePlus
rate plans that come with an unlimited talk and text option will
expedite growth within Telus’ wireless segment. The company will
also benefit from the launch of PTT service in Canada under the
brand Telus Link, which allows walkie-talkie voice communications
over the carrier’s HSPA and LTE networks.
In an attempt to compensate for
access line loss, Telus continues to add features as well as
upgrade the existing features of its Optik TV and Optik High-Speed
Internet broadband services that are gaining traction across
British Columbia, Alberta and Eastern Quebec. Further, Telus
remains committed to enhance shareholders’ wealth and has increased
its quarterly dividend to 36 cents. Telus also enhanced its share
repurchase program to up to $2.5 billion by 2016.
However, the potential rollout of
the 4G LTE wireless service in rural Canada might pose a serious
threat if it fails to acquire the 700 MHz band from the expected
auction in early 2014. Additionally, the wireline segment includes
investments in broadband infrastructure, to bring in more business
and residential customers directly under fiber optic cable.
Substantial network investments could affect its bottom line.
Additionally, Telus continues to
lose local access line to competition from cable TV operators that
have started offering phone service based on the less costly
Voice-over-Internet Protocol (VoIP). We thus prefer to remain
sidelined on the company.
Other Stocks
Other stocks worth mentioning are
Hawaiian Telcom Holdco Inc. (HCOM), Level
3 Communications Inc. (LVLT) and BT Group
plc (BT). HCOM and LVLT carry a Zacks Rank #1 (Strong Buy)
while BT carries a Zacks Rank #2 (Buy).
BT GRP PLC-ADR (BT): Free Stock Analysis Report
HAWAIIAN TELCOM (HCOM): Free Stock Analysis Report
LEVEL 3 COMM (LVLT): Free Stock Analysis Report
TELUS CORP (TU): Free Stock Analysis Report
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