In this article, we discuss 5 best telecom dividend stocks to buy for 2022. If you want to read our detailed analysis of the telecom sector and its outlook, go directly to read 10 Best Telecom Dividend Stocks to Buy for 2022.
5. TELUS Corporation (NYSE:TU)
Dividend Yield as of October 18: 5.16%
TELUS Corporation (NYSE:TU) is a Canada-based national telecommunications company that provides a wide range of related products and services including internet access, video streaming, and voice entertainment.
TELUS Corporation (NYSE:TU) has been making uninterrupted dividend payments since 2004, coming through as one of the best dividend stocks on our list. Since then, the company has cumulatively paid $16.6 billion in dividends. Its current quarterly dividend stands at C$0.3386 per share, with a dividend yield of 5.16%, as of October 18.
In Q2 2022, TELUS Corporation (NYSE:TU) reported over $1.2 billion in operating cash flow, up from $1.13 billion in the previous quarter. The company’s free cash flow came in at $234 million, compared with $122 million a quarter earlier. As of July 2022, the company has paid nearly $1.4 billion in dividends to shareholders.
In October, Barclays maintained an Equal Weight rating on TELUS Corporation (NYSE:TU) with a $23 price target, highlighting the company’s defensive revenue streams.
TELUS Corporation (NYSE:TU) was a part of 15 hedge fund portfolios in Q2 2022, the same as in the previous quarter, according to Insider Monkey’s data. The stakes owned by these hedge funds hold a combined value of over $256.5 million. Renaissance Technologies had the largest position in the company in Q2.
4. BCE Inc. (NYSE:BCE)
Dividend Yield as of October 18: 6.52%
BCE Inc. (NYSE:BCE) is a Canadian mass media company that specializes in telecom-centric services. The company’s operating cash flow in Q2 2022 stood at nearly $2.6 billion, up 4% from the same period last year. Its free cash flow also jumped to $1.3 billion, from $1.24 billion in the prior-year period. The company paid $34 million in dividends to shareholders during the quarter, which shows its stable cash flow.
BCE Inc. (NYSE:BCE) has raised its dividends for consecutive two years after ceasing its payments during the pandemic in 2020. It currently pays a quarterly dividend of C$0.92 per share for a dividend yield of 6.52%, as of October 18.
In October, TD Securities upgraded BCE Inc. (NYSE:BCE) to Buy with a C$62 price target. The firm expects strong results from the company in Q3, especially from its wireless segment.
At the end of Q2 2022, 12 hedge funds tracked by Insider Monkey owned stakes in BCE Inc. (NYSE:BCE), compared with 11 in the previous quarter. These stakes have a total value of nearly $102.6 million. D E Shaw is among the company’s top shareholders in Q2.
3. Verizon Communications Inc. (NYSE:VZ)
Dividend Yield as of October 18: 7.02%
Another best dividend stock from the telecom sector is Verizon Communications Inc. (NYSE:VZ), which provides wireless and broadband services to its consumers. Of the 895 elite funds tracked by Insider Monkey, 58 hedge funds had investments in the company in Q2 2022, compared with 69 in the previous quarter. These investments are collectively valued at nearly $2.3 billion.
On September 6, Verizon Communications Inc. (NYSE:VZ) announced a 2% growth in its dividend, which takes its quarterly dividend to $0.6525 per share. This was the company’s 16th consecutive year of dividend growth. As of October 18, the stock’s dividend yield came in at 7.02%.
In October, Oppenheimer upgraded Verizon Communications Inc. (NYSE:VZ) to Outperform with a $50 price target, appreciating the growth in the company’s customer base. The firm also mentioned that VZ should see a 15% per year growth in its free cash flow.
Mawer Investment Management mentioned Verizon Communications Inc. (NYSE:VZ) in its Q3 2022 investor letter. Here is what the firm has to say:
“There are a few other segments of our portfolios that displayed weakness in the quarter. Cable and telecommunication companies have been an area that has lagged the broader market as their worlds are increasingly colliding. Companies such as Verizon (NYSE:VZ) has been impacted as wireless operator is spending heavily to attract internet subscribers with fixed wired access and the cable companies are trying to build wireless businesses.”
2. AT&T Inc. (NYSE:T)
Dividend Yield as of October 18: 7.25%
AT&T Inc. (NYSE:T) is one of the largest providers of cell phone services in the US. The telecommunications company holds a 23-year track record of consistent dividend growth, which makes it one of the best dividend stocks on our list. It currently pays a dividend of $0.2775 per share every quarter. The stock’s dividend yield stood at 7.25% on October 18.
In September, Barclays maintained an Equal Weight rating on AT&T Inc. (NYSE:T) with an $18 price target, acknowledging the company’s overall pricing growth and cable headline metrics.
In Q2 2022, AT&T Inc. (NYSE:T) generated over $1.1 billion in free cash flow, up from $984 million in the previous quarter. The company’s operating cash flow came in at nearly $6 billion, compared with $5.7 billion at the end of March 2022. Its free cash flow yield stood at 18.9%. The company expects to generate over $10 billion in free cash flow in the second half of the year. AT&T Inc. (NYSE:T) paid over $2 billion worth of dividends during the quarter and its free cash flow dividend payout ratio came in at 150%.
At the end of Q2 2022, 55 hedge funds tracked by Insider Monkey owned stakes in AT&T Inc. (NYSE:T), down from 74 in the previous quarter. These stakes have a total value of over $1.7 billion.
Chartwell Investment Partners mentioned AT&T Inc. (NYSE:T) in its Q2 2022 investor letter. Here is what the firm has to say:
“In the Dividend Equity accounts, the three best performers in Q2 includes AT&T (NYSE:T, 2.5%), up 17.1%. AT&T completed the spin of the WarnerMedia business (HBO, CNN, etc.), and the market seemed to like the “back-to-basics” approach. Also, the telco business is expected to do relatively well in an inflationary environment.”
1. Vodafone Group Public Limited Company (NASDAQ:VOD)
Dividend Yield as of October 18: 8.49%
Vodafone Group Public Limited Company (NASDAQ:VOD) is a British multinational telecommunications company that also offers data services to its consumers.
In October, Oddo BHF upgraded Vodafone Group Public Limited Company (NASDAQ:VOD) to Buy with a 142 GBP price target. The firm highlighted the company’s merger plans in Portugal and Hungary and mentioned that deals are looking more probable.
Vodafone Group Public Limited Company (NASDAQ:VOD) currently pays a quarterly dividend of $0.4725 per share, with a dividend yield of 8.49%, as recorded on October 18.
As of the close of Q2 2022, 15 hedge funds tracked by Insider Monkey owned stakes in Vodafone Group Public Limited Company (NASDAQ:VOD), up from 14 in the previous quarter. These stakes have a collective value of over $566.4 million. Jim Simons and Ken Griffin were some of the company’s leading stakeholders in Q2.
You can also take a look at 11 Best Dividend Aristocrats With Over 3% Yield and 10 Best High-Dividend Stocks to Buy Now
