The Canadian Telecoms

The Canadian TelecomsI’ve written another post for Dividend Stocks Online titled, The Canadian Telecoms.  It is a review of the Canadian telecoms listed on the NYSE, and is intended for U.S. investors. I review the Canadian telecom sector in relation to its economic moat, as well as briefly review the company fundamentals. Here is a snippet:

“The Canadian Telecommunication companies such as Bell (BCE-N), Rogers (RCI-N), Telus (TU-N), and Shaw (SJR-N), are exceptional dividend paying stocks. As a U.S. investor, you can take part in four of Canada’s largest communication companies which will pay you a generous dividend yield. More importantly, you can buy these top Canadian companies without having to worry about foreign content rules, since they are all traded on the NYSE…”

“If you aren’t investing in Canadian Telecoms, then you may want to consider them, even with their higher debt. These giant blue-chips are hybrids between technology and communication companies, and therein lay their strength and economic-moat. They are really utilities which actually own, maintain, and operate the communication infrastructure throughout Canada…”

You can read the entire post at the Dividend Stocks Online website: The Canadian Telecoms »

14 Responses to “The Canadian Telecoms”

  1. Vangrl

    Sep 23. 2011

    Great article Ninja! my Canadian telecom stocks have been a shining light in the last couple of days:)

    now Daylight on the other hand:(

  2. My Own Advisor

    Sep 23. 2011

    Great post my friend!

    Great line and point Ninja: “The economic moat for these Canadian telecoms is extraordinary. Canadians pay some of the highest cell phone fees in the world!”

    Sucks to be us :(

    @Vangrl, CDN telcos are excellent holdings, you probably already knew that like Ninja does.

    Do you own a few telcos?

    I’ve got BCE DRIPpig and a small position in RCI.B. Hopefully I can get more Rogers in 2012 (in TFSA).

    • Vangrl

      Sep 23. 2011

      I own BCE, Rogers, Telus and Bell Aliant.
      BCE is my biggest holding of the telecoms and Rogers my smallest. Bell Aliant is pretty boring but pays a great dividend

      • The Dividend Ninja

        Sep 23. 2011

        Vangral Yes high-yield stocks generally have less growth, becuase their earnings go out to paying dividends instead of being reinvested in the company – usually high yield-stocks have high dividend payout ratios. Bell Aliant is that type of stock. It’s not included in the article since it does not trade on the NYSE.

        Cheers!

  3. The Dividend Ninja

    Sep 23. 2011

    Vangral

    Thanx for posting! Yes these Canadian Telecoms (excluding Shaw) are great defensive stocks – and pay great dividends also. However the high debt and rising dividend payout ratios may catch up with these guys. I like Telus the best for fundamentals.

    MOA

    Thanx! Yes sucks to be at the top of the list for “most expensive” doesn’t it? Mutual Fund fees as well…

    My disclaimer was taken off the article, I am long on Rogers Communications (RCI.B-T) and Shaw (SJR.B-T). I would buy Telus (T-T) without hesitation, but not BCE.

    Cheers
    The Dividend Ninja

    • Vangrl

      Sep 23. 2011

      why not BCE?

      • The Dividend Ninja

        Sep 23. 2011

        Vangral BCE is a great company, and I know most Canadian dividend investors are enamoured with their largest telecom. BCE has a great yield at 5.4% But it also has a dividend payout ratio of 76.3% (which has been increasing this year) and a debt-to-equity ratio of 101.31. It has a lot of debt. Those numbers are just a little too high for my liking.

        I’m not suggesting you sell BCE, far from it, but I won’t be buying. Telus has better fundamentals – but you are already diversified nicley in the Telecom sector :)

        • Vangrl

          Sep 24. 2011

          gotcha!

  4. MoneyCone

    Sep 25. 2011

    Only a few months back I bought Rogers! I need to ramp up my Canadian allocation!

  5. The Dividend Ninja

    Sep 25. 2011

    MoneyCone Did you get it at that nice $34 level a while ago? This company has been on sale for a while, mainly becuase invetors perceived Wind Mobile’s move into western Canada as a threat.

  6. Rock the Casbah

    Sep 26. 2011

    Thanx D. Ninja for this article on Canadian Telecoms. Glad you brought some attention to them. I’m just surprised that you don’t hear more about them as investment opportunities down here in the States.

    I own Telus for the reasons you pointed out. And I think there is limited wireless penetration in Western Canada (relative to the States and Eastern Canada) so perhaps some opportunities there for growth.

    I’ve commented on D. Mantra’s site that sometimes I feel as if I’m the only American who’s heard of Telus and owns the stock. Unfortunately, I do think that the American shares are non-voting however.

    I heard Harper is potentially interested in opening up Canada’s Telecom market to more international Telecom companies. Any thoughts?

    Thanx for any input.

  7. The Dividend Ninja

    Sep 26. 2011

    Rock the Casbah thanx for posting! I think many Americans don’t realize they can actually buy Canadian stocks on U.S. exchanges. We have some great companies up here that pay higher dividends ;) Maybe that is worth another post!

    I’ve never really been one to care about my voting rights in a company, non-issue for me, but for some people it is an important consideration.

    If Harper opens up the path for more international telecoms, I don’t think it is such a huge issue as people think. Rogers, Telus, and BCE own the infastructure – and a massive one at that. It would be hard for someone to come in and build a new infastructure, get it up and running quickly, and be profitable at the same time – just my thoughts ;)

    Cheers

Trackbacks/Pingbacks

  1. My Own Advisor » Weekend Reading – Dividend Growth Index edition » My Own Advisor - September 29th, 2011

    [...] playing backgammon and the stock market.    If you missed his other guest post, he wrote about Canadian telcos for Dividend Stocks Online.  Ninja also provided his introduction for the Dividend Growth Index.  (I gotta recruit the Ninja [...]

  2. Weekend Ramblings & PF Blog Love: Almost Taken Advantage of Edition | youngandthrifty.ca - September 30th, 2011

    [...] Ninja talks about the Canadian telecoms- I own Telus and Bell shares- I think there’s still a lot of profit to be had in the Canadian [...]