Results: TELUS Corporation Exceeded Expectations And The Consensus Has Updated Its Estimates

Investors in TELUS Corporation (TSE:T) had a good week, as its shares rose 7.1% to close at CA$22.33 following the release of its first-quarter results. Revenues were CA$5.1b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at CA$0.21, an impressive 31% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Following the latest results, TELUS' 16 analysts are now forecasting revenues of CA$20.9b in 2025. This would be a modest 2.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 16% to CA$0.90. Before this earnings report, the analysts had been forecasting revenues of CA$20.9b and earnings per share (EPS) of CA$0.82 in 2025. So the consensus seems to have become somewhat more optimistic on TELUS' earnings potential following these results.

View our latest analysis for TELUS

There's been no major changes to the consensus price target of CA$23.06, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values TELUS at CA$30.00 per share, while the most bearish prices it at CA$20.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that TELUS' revenue growth is expected to slow, with the forecast 3.7% annualised growth rate until the end of 2025 being well below the historical 7.1% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.0% annually. Even after the forecast slowdown in growth, it seems obvious that TELUS is also expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around TELUS' earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at CA$23.06, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for TELUS going out to 2027, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 2 warning signs for TELUS you should know about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.