Corus Entertainment (B) (CJR.B.TO)

He does not think the dividend is sustainable over the long term. It looked better 6 months ago, but their Q4 revenues were decimated. They do justify their dividend with cash flows, it is not in danger today, but with ad revenues declining, the dividend might be threatened three or six months from now. Watch out for a dividend cut if ad revenues continue to be under pressure.

Selling has been overdone recently. Dividend will probably come off. Payout ratio reasonable, but balance sheet could be stronger in working capital. Buy it for valuation, which is reasonable, but not the dividend.

It has a 13% yield. Subscriber revenues have been nice and steady. They had a drop in advertizing revenues. They are gaining market share but the pie is shrinking more so. The concern is that this could be a trend. They have a lot of debt they are trying to pay down. Management is doing a good job of streamlining costs.

This is not doing great. First of all, there is an up-trend line, which is very gentle. That means buyers are not very excited and sellers are quite persistent. The uptrend line has now been broken and looks like it is going lower.

He does not like the business much. It got hit on the TVs. The dividend is good for another year but unless there is improvement they will be caused to cut the dividend in 2019. If it was only a 10-20% cut it would still be okay. That is what the stock is telling you. It is probably overdone. If they reported a couple of decent quarters you would probably come back to $10. Hold it for the year but closer to the end of the year you might want to sell it if there had been no improvement.

Dividend yield of 13.5% since the price plunge. When you see that sort of dividend yield, it usually telegraphs something is coming. There is a transition in the world of entertainment. Unfortunately, it's bad for companies like this. They have a big component in advertising, and the value of that advertising is going down. The concern is that this in secular decline now. Profits are under pressure, and until we see the dividend cut that the stock is telegraphing, it is probably in no man's land and will probably go sideways. Probably not that much downside in the near term, and longer-term it depends on how the fundamentals develop. A lot of people don't want to be there because it is gone from a growth situation to a potential shrinking situation. He would be in no rush to get involved.

He wouldn't depend on the dividend. They are only earning $1, if they are lucky. Advertising revenues are going down. Getting hit on all sides including by Netflix. Thinks the dividend will get cut. There is no growth. If they cut the dividend in half, you are still earning 6%, and he thinks the market is anticipating that. He wouldn't buy this here.

Owning this is similar to blindfolding yourself, and trying to walk through your house. You can't really see where you are going, but you roughly have an idea of what is going on. On this company, we know the business, we know the assets and we know what they are trying to do, but the challenge is that the industry is going through so much change and it is very difficult to value the assets. There are 2 distinctive unknowns with this. 1.) Valuing the assets and 2) betting on their ability to turn around the business they are focused on. Technically they should cut the dividend, but have no choice as that is what is keeping investors there. Dividend yield of 10.3%.

It is an industry that is changing rapidly. The pricing model and paradigms are changing rapidly. It is difficult to know how valuable the assets in the corporation are and what pricing power they will have. He thinks the dividend is at risk.

Almost 10% dividend. It specializes in children’s content and woman’s content. They have too much debt but are paying it down. Dividend coverage is getting a bit close. There is a large holding by Shaw so you never know when they will sell more of it.

(Market Call Minute.) The media group has been very tricky and is one he would avoid right now.

Although it has had a huge dip, her preference would be to stay away and wait, because when you get to levels like this, there is a question about sustainability of the dividend. Distribution channels are changing, so they are kind of in a changing landscape.

It has come down recently mainly because all of the north American broadcasting stocks got pummeled with all the cord cutting. However they did have advertizing revenue growth and also subscriber growth because of the adding of the DIS-N channels. He thinks the stock won’t go anywhere but you collect your dividend. They have to focus on paying down debt and invest wisely so they own more of their content. The Shaw family is hanging on also.

After its 1^st leg of recovery, as the stock started to go sideways, he sold his holdings. He has a tough time seeing a business pay a 10% yield when they have the challenges this company has. Dividend yield of 9.78% which he doesn’t think is safe, as they should cut it to do better allocation of capital.

The chart is not looking good. Technically it is in a downward trend. What makes it intriguing is that seasonality starts turning positive around the 2^nd week in December, and this moves higher as we get early into the new year. The stock is under attack right now from tax loss selling. Watch for opportunities for it to come under a bit of pressure for a buying opportunity, probably within the next 2 to-3 weeks, after forming a nice little base.