One major conviction buy in the last quarter came from Canadian telecom firm Telus (TU), a stock that went from nearly zero U.S. institutional ownership to firms building a 362 million share position in the Vancouver-based communications stock. So what do the pros like about the Canadian carrier?
Telus is a firm on the mend. Despite a major position in Canada's telecom infrastructure that spans more than more than 7 million phone customers, 3.5 million fixed-line subscribers and nearly 1.5 million internet and TV subscribers, the firm has been struggling to increase the revenues that it earns from each user in its customer rolodex. But rivals haven't. Now, though, the revenue challenge appears to be lessening, especially as smartphone usage continues to increase alongside newer offerings like TV.Subscriber churning is like kryptonite for a firm like Telus. Because of the huge costs of customer acquisition, losing names to a rival is a major concern. Telus' ability to keep churn rates low in recent quarters is a major plus for shareholders. While antitrust rulings make growth by acquisition in Canada look less viable, TU should have upside ahead of it now that it's finding success selling add-on services to its existing base again.
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