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Rogers Communications Inc Shs -B- Non-Voting RCI

Morningstar Rating
$37.82 +0.92 (2.49%)
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Company Report

Rogers Earnings: Continuing Strength in Wireless Drives Solid Results

We’re maintaining our CAD 78 fair value estimate following Rogers’ second-quarter earnings. Management continues to see strength in wireless while making progress in cable, though cable revenue continues to struggle. Overall, it was a solid quarter of continuing growth that doesn’t line up with the recent stock bearishness, in our opinion. We believe Rogers remains significantly undervalued.

Price vs Fair Value

RCI is trading within a range we consider fairly valued.
Price
$37.82
Fair Value
$13.00
Uncertainty
Low
1-Star Price
$43.45
5-Star Price
$58.30
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

With the Canadian wireless market less penetrated than the US and Europe and the country receptive to immigrants and foreign workers, wireless subscriber growth should remain high. As the industry leader, Rogers is well positioned.

Bears

A heavy-handed regulatory environment and competition will prevent Rogers from raising prices substantially, thus damping hopes for material revenue growth.

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News

Trading Information

Previous Close Price
$36.90
Day Range
$37.0937.89
52-Week Range
$35.5548.08
Bid/Ask
$15.12 / $39.29
Market Cap
$20.15 Bil
Volume/Avg
578,535 / 885,237

Key Statistics

Price/Earnings (Normalized)
10.98
Price/Sales
1.33
Dividend Yield (Trailing)
3.91%
Dividend Yield (Forward)
3.83%
Total Yield
3.91%

Company Profile

Rogers Communications is the largest wireless service provider in Canada, with its more than 11 million subscribers equating to one third of the total Canadian market. Its wireless business accounted for more than half of total revenue and has increasingly been providing a bigger portion of total company sales over the last several years. Rogers' cable segment, which provides about 35% of total revenue after acquiring Shaw, offers home internet, television, and landline phone service to consumers and businesses. Remaining sales come from Rogers' media unit, which owns and operates various television and radio stations and the Toronto Blue Jays. Rogers' significant exposure to sports also includes ownership stakes in the Toronto Maple Leafs, Raptors, FC, and Argonauts.
Sector
Communication Services
Industry
Telecom Services
Stock Style Box
Large Value
Total Number of Employees
26,000

Competitors

Valuation

Metric
RCI
BCE
QBR.B
Price/Earnings (Normalized)
10.9814.6210.45
Price/Book Value
2.602.503.69
Price/Sales
1.331.671.25
Price/Cash Flow
4.275.304.30
Price/Earnings
RCI
BCE
QBR.B

Financial Strength

Metric
RCI
BCE
QBR.B
Quick Ratio
0.500.460.38
Current Ratio
0.650.610.65
Interest Coverage
1.642.713.17
Quick Ratio
RCI
BCE
QBR.B

Profitability

Metric
RCI
BCE
QBR.B
Return on Assets (Normalized)
3.54%3.96%6.00%
Return on Equity (Normalized)
22.81%16.39%44.57%
Return on Invested Capital (Normalized)
6.69%6.68%10.85%
Return on Assets
RCI
BCE
QBR.B
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