The Top Canadian Telecommunication Stocks to Buy in February 2025

Key takeaways

Stable but Competitive Industry: Canada’s telecom sector is dominated by a few key players, offering reliable cash flows and dividends, but increased competition—especially with Quebecor’s expansion—could shake up the landscape.

Regulation is a Double-Edged Sword: Government intervention, whether through spectrum auctions, pricing rules, or competition policies, can either help or hurt telecom stocks, making regulatory changes a key factor to watch.

5G and Fiber Drive Growth: While traditional wireless and broadband services remain the backbone of the industry, investments in 5G networks and fiber-optic infrastructure will be major drivers of future profitability.

3 stocks I like better than the ones on this list.

Many Canadian investors are heavily invested in telecoms, which are attractive for several reasons. After all, these companies play a major part in our everyday lives, providing the important infrastructure to keep in touch with loved ones.

Combine that with plenty of predictable cash flow and some of the best dividends you’ll find, and it’s pretty clear why many Canadians are big fans of investing in our largest telecom companies, which happen to be some of the best dividend stocks on the planet. 

Are Canada’s telecom stocks a good buy now?

Over the long-term, Canada’s telecom stocks have provided solid returns to investors, with a basket of the largest companies in the industry providing a return of approximately 10-11% per year, including reinvested dividends, over the last 20 years.

Lately, however, Canada’s largest telecom stocks have been struggling. These high-debt companies have to borrow fairly aggressively to build their networks. The last few years have seen higher than normal capex spending as wireless networks are upgraded to 5G.

This higher debt has become an issue today as interest rates have skyrocketed off pandemic lows. As a result, most of Canada’s telecom stocks are well off their all-time highs, with the market worried that mismanagement has led to inevitable dividend cuts.

This is especially the case with BCE, Canada’s largest telecom company. So much so that this blue-chip stock was removed from the list a year ago.

The good news is this entire situation has arguably created a long-term buying opportunity for the stocks on this list. We cannot predict future returns, but generally, those who have bought these stocks at lows have earned good returns over the long term. 

Of note, this list is in no particular order.

Mid-sized telecom with a strong regional focus

Cogeco Communications (TSE:CGO)

Cogeco Communications is a Quebec-based telecom company that provides internet, television, and phone services across Ontario and Quebec, with additional operations in the U.S. through its Atlantic Broadband division. Unlike its larger rivals, Cogeco has carved out a niche by focusing on underserved markets, where it benefits from strong customer loyalty and lower competition. It has also been expanding its fiber network to enhance its service offerings.

P/E: 5.7

5 Yr Revenue Growth: 4.7%

5 Yr Earnings Growth: -0.6%

5 Yr Dividend Growth: 14.7%

Yield: 6.7%

  • Strong presence in smaller markets with limited competition.
  • Expansion in the U.S. provides growth outside Canada.
  • Solid dividend with a history of increases.
  • Conservative management with a focus on profitability.
  • Less regulatory scrutiny compared to bigger telecoms.
  • Growth in broadband demand benefits its internet services.
  • U.S. Expansion: Growth in Atlantic Broadband operations could be a key driver.
  • Fiber Rollout: Investment in fiber optics to stay competitive.
  • Competitive Pressure: Larger Canadian telecoms may push into its market.
  • Regulatory Shifts: Potential policy changes affecting pricing or market access.
  • Limited Scale: Smaller market share compared to larger rivals.
  • Debt Levels: Growth investments require significant capital.
  • Regulatory Risks: Potential government intervention in telecom pricing.
  • Competition from Bigger Players: Large telecoms expanding into its markets.

A telecom powerhouse in Quebec, expanding beyond

Quebecor (TSE:QBR.B)

Quebecor is the dominant telecom player in Quebec, offering wireless, internet, and television services under the Videotron brand. The company has been aggressively expanding outside its home province, particularly with its acquisition of Freedom Mobile, giving it a national presence in wireless. Quebecor is known for its competitive pricing and strong brand loyalty in Quebec.

P/E: 10.6

5 Yr Revenue Growth: 5.4%

5 Yr Earnings Growth: 10.8%

5 Yr Dividend Growth: 44.2%

Yield: 4.0%

  • Dominant market share in Quebec, a high-margin region.
  • Freedom Mobile expansion increases its national footprint.
  • Strong cash flow supports dividends and reinvestment.
  • Competitive pricing strategy attracts cost-conscious customers.
  • Ownership of media assets creates synergies with telecom.
  • Potential for future mergers or acquisitions to accelerate growth.
  • Freedom Mobile Growth: Success outside Quebec is crucial for future earnings.
  • Wireless Competition: How it competes against Rogers, Bell, and Telus nationally.
  • Government Regulation: Policies favoring competition could benefit its expansion.
  • Media Synergies: Its media assets could strengthen its telecom business.
  • Limited National Presence: Still a small player outside Quebec.
  • Competitive Pricing Pressures: Lower prices could squeeze margins.
  • Integration Challenges: Expanding Freedom Mobile could be costly.
  • Regulatory Uncertainty: Rules on wireless pricing could impact profitability.

One of Canada’s largest telecom giants

Rogers Communications (TSE:RCI.B)

Rogers Communications is a dominant player in Canada’s telecom industry, offering wireless, internet, and media services. It recently completed its massive acquisition of Shaw Communications, significantly expanding its broadband and wireless coverage, especially in Western Canada. Rogers also owns key media assets, including Sportsnet and the Toronto Blue Jays.

P/E: 11.8

5 Yr Revenue Growth: 5.8%

5 Yr Earnings Growth: -4.8%

5 Yr Dividend Growth: -0.6%

Yield: 5.3%

  • Largest wireless provider in Canada post-Shaw acquisition.
  • Strong presence in major urban centers.
  • Vertical integration with sports/media assets provides synergies.
  • Significant pricing power due to market dominance.
  • 5G rollout offers a new growth avenue.
  • High dividend yield appeals to income investors.
  • Shaw Acquisition Integration: Cost synergies and network expansion from the deal.
  • 5G Network Expansion: Higher speeds and new revenue opportunities.
  • Media Performance: Sports and broadcasting revenue impact overall earnings.
  • Competition with Bell and Telus: How it handles pricing pressure and market share battles.
  • Regulatory Scrutiny: Government intervention on competition and pricing.
  • High Debt Load: Shaw acquisition adds financial risk.
  • Service Outages: Past major network failures impact reputation.
  • Customer Retention: Strong competition could drive churn.

A telecom leader with a tech-driven focus

TELUS (TSE:T)

TELUS is one of Canada’s top telecom companies, offering wireless and internet services nationwide. Unlike its peers, TELUS has aggressively expanded into digital health, AI, and agriculture technology, creating diversified revenue streams. It is also known for strong customer service and high retention rates.

P/E: 33.5

5 Yr Revenue Growth: 7.3%

5 Yr Earnings Growth: -15.4%

5 Yr Dividend Growth: 6.7%

Yield: 7.4%

  • Strong wireless and broadband business across Canada.
  • TELUS Health and TELUS Agriculture provide diversification.
  • High customer satisfaction and lower churn than competitors.
  • Steady dividend growth makes it attractive for income investors.
  • 5G network expansion provides new revenue opportunities.
  • AI and digital transformation initiatives give it a competitive edge.
  • TELUS Health Expansion: Digital health is a growing segment with high potential.
  • 5G Monetization: How TELUS leverages 5G for new revenue streams.
  • Tech Innovation: AI and automation projects improving efficiency.
  • Customer Growth: Retaining and expanding its subscriber base.
  • Capital Expenditures: Heavy spending on 5G and fiber networks.
  • Competition from Rivals: Bell, Rogers, and new entrants challenge its market share.
  • Tech Investments Uncertainty: Non-telecom ventures may not deliver expected returns.
  • Regulatory Changes: Policy shifts could impact pricing and competition.

How safe are Canadian telecom stocks?

Despite the recent near-term weakness in their stock prices, Canada’s telecom stocks are often ranked among the safest on the TSX Composite Index. 

These telecom giants have one of the biggest moats in the entire market. Firstly, they’ve collectively invested billions in building broadband wireless and wireline networks, connecting Canadian consumers from coast to coast. It would take a massive investment from a new player to compete. 

Even if someone new wanted to enter the Canadian telecom market, ownership restrictions exist. Once a foreign telecom captures 10% of the Canadian market, it must have a board of directors comprising 80% Canadians and prove a non-Canadian does not control it.

This limits deep-pocketed foreign competitors from entering the market and is likely what thwarted Verizon’s attempt to enter the Canadian market in 2015. 

Essentially, these stocks are an oligopoly. This is good news for investors but not-so-great news for consumers. Canadians consistently pay more for wireless services than other developed nations. 

How about the risks of these telecom players?

There are no doubt risks when it comes to these telecoms however, primarily in the form of regulation. Many Canadians are strapped for cash as we go through a significant cost of living crisis.

As a result, many are not buying new phones and are demanding lower payments on their plans. With a BYOD plan, they can do so, as the telecom company doesn’t have much leverage. As a result, we are seeing ARPUs, or Average Revenue Per User, decline.

In addition to this, regulatory changes to allow foreign competition to enter the space is always a concern. This could impact Canada’s telecom market even further.

And finally, a reduction in immigration here in Canada could impact these companies ability to acquire new customers. Canadian birth rates are at some of the lowest levels in history, primarily due to the costs of having children, and as a result these telecoms rely heavily on immigrants coming to the country. If this slows, so too will new customer additions.