Rogers’ Wireless Business Is Well Positioned; Adding Shaw Creates Margin Expansion Potential

Rogers has ramped up investment in its wireless network in recent years and completely alleviated our concern that its network had been falling behind peers. Rogers was the biggest spender in 2019’s 600-megahertz spectrum auction and 2021’s 3500-megahertz spectrum auction, and we don’t think its 4G or 5G networks have any practical differences versus its two big rivals. Since 2022, Rogers has had the strongest wireless business in Canada, and we don’t expect it to lose ground. With Canada’s policy to keep immigration high and allow in other foreign workers and students, Rogers is well positioned to keep growing its wireless subscriber base. Considering the industry tailwinds, we don’t expect wireless customer growth to be severely dented by increasing competition, but we do think pricing will be hit across the industry by competitive pressure.