Which of the 3 Best Value Telecom Stocks in Canada Is a Buy?

For a sturdy telecom dividend payer, Rogers Communications Inc. (TSX:RCI.B)(NYSE:RCI) is one of the best. But is it the best value?

Are you looking for three Canadian growth stocks that are currently good value for money and pay healthy dividends?

You may not have thought of looking to the telecom sector, but, surprisingly enough, that’s where you’ll find some of the best dividend payers on the TSX. Let’s take a look at three of the most solid picks and see which gives you the best bang for your buck.

Three stocks to earn you a profit, but which is best?

If you want stable dividends that can be funneled straight into your TFSA or RRSP, and Canadian telecoms are your thing, you might want to start with the two biggest.

BCE Inc. (TSX:BCE)(NYSE:BCE) offers a tasty 5.51% dividend yield, which is expected to rise to 5.71% next year. With a discount of 32% it’s currently undervalued — for now. If you don’t own telecom stock yet, this might be a good place to start. BCE is well known (folks still know it as Bell), so it’s got brand familiarity going for it. It’s also hitting the headlines as being a cheap stock, so you may want to grab it while you can before there’s a rush.

Next up is Rogers Communications Inc. (TSX:RCI.B)(NYSE:RCI). Talk about brand familiarity! You already know Rogers, but were you aware that it’s possibly the one of the healthiest stocks on the TSX?

Rogers is arguably the healthiest of the three stocks here, if you care to take a look at under the bonnet. It’s got a solid track record, is trading below its projected cash flow value, and has an expected 9.7% earnings-growth curve ahead of it. Sounds good, eh? While its dividend yield is 3.12%, making it the lowest payer of the three, you should factor in its strong past performance in terms of payments if you’re concerned about reliability.

Telus everything you know…

If you’re looking for a dividend stock with a decent price-to-book ratio, Telus Corporation (TSX:T)(NYSE:TU) might be your guy. Paying a 4.59% yield on your investment and with a P/B of 2.9 times, Telus is the better value of the three stocks when compared to the sector average.

Telus also comes out on top in terms of past earnings, with positive growth over the last five years that beat its own five-year average, and one-year growth that exceeded the market average for the same period. If you’ve been eyeing Rogers and BCE for a buy, consider this a challenge!

The bottom line

If you’re looking at past earnings and a decent dividend yield, Telus is the one for you. Depending on your desired metrics, though, you may want to go for one of its competitors. Choose Rogers for its overall health, projected annual growth earnings, and 10-year dividend stability, or BCE for a higher dividend yield and discounted share price. At the end of the day, all three are good value, solid dividend payers, and growth stocks to boot, so the choice is yours.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Victoria Hetherington has no position in any of the stocks mentioned.

More on Dividend Stocks

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

Where to Invest Your $7,000 TFSA Contribution

The TFSA is attractive for investors who want to generate tax-free passive income.

Read more »

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.
Dividend Stocks

TFSA Investors: 3 Dividend Stocks Worth Holding Forever

These TSX stocks have the potential to grow their dividends over the next decade, making them top investments for TFSA…

Read more »

Tractor spraying a field of wheat
Dividend Stocks

Is Nutrien Stock a Buy for its Dividend Yield?

Nutrien is down more than 50% form the 2022 highs. Is NTR stock now oversold?

Read more »

golden sunset in crude oil refinery with pipeline system
Dividend Stocks

Best Stock to Buy Right Now: Enbridge vs TC Energy?

Enbridge and TC Energy rebounded nicely over the past year. Are more gains on the way?

Read more »

Electricity transmission towers with orange glowing wires against night sky
Dividend Stocks

2 Utility Stocks That Are Smart Buys for Canadians in November

Are you looking for some of the smart buys to consider in November? These utility stocks offer growth and a…

Read more »

View of high rise corporate buildings in the financial district of Toronto, Canada
Dividend Stocks

Is Power Corporation of Canada Stock a Buy for its 5% Dividend Yield?

Is Power Corporation of Canada (TSX:POW) stock's 5% dividend yield worth it? Discover why this resilient stock could be a…

Read more »

hand stacks coins
Dividend Stocks

Here Are My Top 3 Dividend Stocks to Buy Now

These three dividend stocks are ideal for strengthening your portfolio and earning a stable passive income.

Read more »

man touches brain to show a good idea
Dividend Stocks

3 No-Brainer REIT Stocks to Buy Right Now for Less Than $200

REITs have long been touted as some of the best dividend stocks out there if you want recurring, strong income.…

Read more »