Rogers Communications (B) (RCI.B.TO)

Doesn't rank super-well in his universe (in bottom 1/3 out of 1000 Canadian companies), and has a lot to do with earnings acceleration profile. Move off the bottom probably due to value seekers, dividend, and sports plans. Wireless side is challenged.

A purely dividend investor could hold.

(Note the shortish timeframe.)  Telcos are still in the penalty box. Price war has effectively slowed down. Infrastructure assets are underappreciated. Slower immigration has been a drag. Still likes the sector. 

Regulatory changes on immigration have impacted the entire sector, and competitive pricing has weighed it down.

His choice in the telco space. Opportunities to monetize MLSE. Among peers, its balance sheet is the most compelling going forward.

All the telcos are debt-laden, and they have to pay interest on that. Unable to get pricing power from the 5G movement. Now we're coming up on 6G, so they're going to be spending more. But revenues aren't rising. This name hasn't raised dividend in 10 years, as it's had to allocate a lot of capex out of free cashflow.

Not something he wants to get involved in. He does, however, own CCA in client TFSAs.

This year, money has rotated from telcos to cable companies like this one. Inferior network, both wireless and wired. Telcos' capex winding down, cable companies now need to spend to upgrade. Fairly valued today, telecoms are much cheaper and probably due for some sort of mean reversion. Be cautious, but if you already own there's no reason to part with it.

Sports team has added value, but still has to buy out (using debt) the remaining minority stake. Then what? Family may want to still retain control. May not be as big a monetization as people are hoping -- an uncertain catalyst.

Whole sector struggles on its growth outlook. He chose this one because, at 10x PE, it has the lowest valuation of the peer group. Massive hidden value with sports assets. Pretty robust dividend.

The worries over telcos have passed, with worries over Quebecor, the fourth player, entering, and in lower immigration to buy phone plans. Rogers is his favourite, though doesn't pay the biggest dividend, but is undervalued due to the sports assets. He liked the Shaw deal.

Huge run since April. Pricing has gotten better for the incumbent telcos. Cost management pretty good. Doesn't overpay for the dividend. Sees lots of growth and upside over next couple of years.

Has had a strong move after languishing along with other telcos. Telcos are boring and defensive, lower beta. So they'll weather the upcoming corrective storm of 1-3 months. 

It's time to step back into telcos. Dividends are sustainable. He owns all 3 Canadian telcos. Share prices have bottomed, and he expects margin improvement. Costs have been slashed. Is partially optimistic, because shares have been so beaten down, and yet the industry isn't going anywhere. There will be some growth going forward. Is bullish on telcos. BCE's strategy in the US (buying a US company) will generate reasonable value. Telus is the faster grower and has made good moves outside telecoms to create value. Rogers is more of a question mark, including their sports holding, but is worth a ton of money (the value of sports teams is huge).

Likes companies that are in multiple business segments, and this one has diversified. In his dividend model with its nice dividend. Incorporating more AI, which will provide a leg up going forward.

Sector has underperformed dramatically last couple of years. Immigration changes have slowed growth, more competition with Quebecor. Starting to see pressure mitigate a bit. Shaw added massive debt. Cashflow growth starting to improve, and FCF starting to increase. Paying down debt. Starting to monetize assets. Low valuation. Sports franchises are underappreciated. Yield is 4.21%.

All telcos have been facing highly competitive pricing environment, slowing immigration targets, and lots of infrastructure capex. Better payout ratio, as it didn't raise dividends as much as others. So the dividend is safe. Debt issue from MLSE deal; sports assets are valuable, but not necessarily cashflow positive.