TELUS International IPO: TIXT Stock to Dual List NYSE and TSX
A TELUS International IPO is on the way. After launching its virtual roadshow Monday, investors are curious about TELUS stock. As a business spun off publicly by its parent company, it looks promising to many. And unlike some recent offerings, TELUS is following the traditional IPO process.
But is TELUS International a good investment opportunity? Here’s what we know…
TELUS International: The Business
TELUS International is a subsidiary of TELUS Corporation. It’s a global communications and information technology company. TELUS designs, builds and delivers solutions for digital customer experience. By working with its parent company, TELUS Corporation, and sister company, TELUS Health, TELUS is able to provide full service for clients, regardless of what phase they’re at with technology.
TELUS focuses on helping clients deliver the best customer experience. This improves brand awareness and customer loyalty. The company works with over 600 clients. Industries range from Tech and Games to Communications and Media to eCommerce, FinTech and Healthcare. TELUS has over 50,000 team members across more than 20 countries.
The company has some big names to back up its business, including tech giant Alphabet (Nasdaq: GOOG). But for a TELUS International IPO to be successful, it needs a growing market.
TIXT Stock: The Market
In the prospectus, TELUS gives data on two market opportunities.
Digital Transformation of Customer Experience Systems (DX). International Data Corporation (IDC) estimated the DX market was $147 billion in 2019. It’s expected to grow at a compound annual growth rate (CAGR) of 21% from 2019 to 2023.
Digital Customer Experience Management (DCXM). Everest Global estimated the global market for DCXM. It was worth $6 billion in 2018. Everest expects the DCXM market to grow at a CAGR of 20%-25% from 2018-2021.
The announcement of TELUS stock comes in the same week SAP’s Qualtrics is expected to IPO. Qualtrics focuses on software for the experience economy. A competitor, TELUS also understands customers are usually willing to pay a little more for a better customer experience. And it’s more likely to keep the customer coming back.
But how is the company performing financially?
The Financial Data
In 2017, TELUS recorded $573.2 million in revenue. It grew 45.6% to $834.6 million in 2018. Revenue grew again in 2019 to $1 billion for a growth rate of 22.2%. And for the nine months ended September 30, 2020, revenue was $1.14 billion. That’s a growth of 52.5% from the 2019 number of $747.1 million.
In addition to rising revenue, TELUS has increasing net income. In 2017, it was $43.4 million. It grew to $47.1 million and $69 million in 2018 and 2019, respectively. That’s a growth of 8.5% in 2018 and 46.5% in 2019. For the nine months ended September 30, net income was $41.7 million in 2019. It nearly doubled with a growth rate of 96.4% in 2020 to $81.9 million.
TELUS also lists its pro forma numbers. If interested, you can find more financial data in the TELUS International IPO prospectus.
Lastly, TELUS has debt. According to the prospectus, long-term debt was $1.07 billion as of September 30, 2020. Current maturities at the same was $77 million. Under “Use of Proceeds,” TELUS claims proceeds from the sale of TELUS stock will be used to repay outstanding borrowing and for general corporate purposes.
So, for those interested in the TELUS International IPO, let’s look at the details.
TELUS International IPO Date, Price and Size
TELUS International filed on January 8, 2020. It set terms on January 25. The expected IPO price range was $23 to $25 per share. On February 2, TELUS offered 37 million shares for a deal size of $925 million.
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What is the TELUS International IPO Date? TELUS International will be dual listed on the NYSE and TSX. The ticker symbol will be TIXT. TELUS stock is expected to trade on February 3, 2021.