Telus Earnings: Business Looks Pretty Good as the Firm Navigates Higher Competition

Our takeaway from Telus’ third-quarter results was strikingly similar to peer BCE’s report a day earlier. Telus posted good telecom results that saw it continuing to add broadband customers to its fiber network and a near-record number of mobile phone subscribers. But Telus’ results also showed signs of increasing wireless competition after Quebecor entered the national market in the spring. Customer churn took a notable tick up, and average revenue per user, or ARPU, declined. The competitive environment and limited ability to expand ARPU have been part of our thesis for the Big Three Canadian wireless carriers. We’re maintaining our projections and our CAD 33 fair value estimate for Telus. We see each of the Big Three as undervalued.