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Larry Berman CFA, CMT, CTAShaw Communication (B)SJR.B.TOCOMMENTMar 21, 2016

SJR.B-T vs. CJR.B-T. He wants to buy a good company when it is relatively cheap. Technically there is some relative value to both.

Larry Berman CFA, CMT, CTA

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$25.36

Stock price when the opinion was issued

$40.48

As of Apr 04, 2023. Market Open.

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DON'T BUY

It comes down to the Rogers deal, which the street thinks will happen, but this is the fourth deadline extension. The deal has been priced into shares, so there isn't much upside. Better to buy Rogers or Telus than Shaw.

COMMENT

Rogers will probably win the court battle, though there will be concessions. You better like Rogers.

PAST TOP PICK

(A Top Pick Aug 26/21, Down 5%) Last year, he considered this safe with some upside, but that hasn't happened. The Rogers deal has gone slower than expected, but it should close. He sold half his position at $38.50 last March, at a $22 ACB. The deal should close at end-2023.

COMMENT

No real clarity yet on the takeover. Frustrating. Rock solid. Free cashflow generator, solid dividend. Long term, it would be harder for them to carry on as a standalone company.

PAST TOP PICK

(A Top Pick Apr 09/21, Up 19.74%) Bought it as merger arbitrage. He made his target profit of 24% and moved on.

PAST TOP PICK

(A Top Pick Jan 06/21, Up 70%) The deal should go through. Stock is still at a healthy discount to the deal price, which would be a 10+% return in 3 months. He's holding, but not buying more.

PAST TOP PICK

(A Top Pick Dec 29/20, Up 76%) Believed entire sector was cheap and Roger's purchase of business was a bonus. Good dividend yield and grow opportunities for the sector.

DON'T BUY

Allan Tong’s Discover Picks Shaw doesn’t suffer the same corporate soap opera, but it’s still part of the drama because of this deal. I know, I know, I wrote about Shaw and Rogers recently, but things keep changing fast. If I want drama, I’ll watch The Squid Game or Maid on Netflix.

PAST TOP PICK

(A Top Pick Dec 29/20, Up 71%) He bought if for the fundamentals. He sold, and shifted the money into Rogers. He's not a risk taker.

SELL

Allan Tong’s Discover Picks Since March 15, Shaw has gained 5.1%, lagging Telus at 6.5% and BCE at 13%. (Rogers is -2.2%.) There's little catalyst to increase the share price, so the question becomes whether to hold on or sell now. The downturn this month may offer a buying opportunity, but we're talking a quick trade. Shaw's fate is now tied to the soap opera at Rogers and hurting shares. Further, there's a risk that Ottawa will not approve the merger, though the street is confident it will happen. If the deal collapses, SJR.B stocks could tank. Are you willing to take that risk, or will you be cautious and sell? Read The Battle for Rogers and 4 Other Telecom Stocks to Consider for our full analysis.

PAST TOP PICK

(A Top Pick Dec 29/20, Up 69%) It was a bonus that RCI.B-T decided to buy them out.

DON'T BUY

RCI.B-T vs. SJR.B-T. He is not buying either right now. He owns Bell and Telus. There is deal risk in the merger between Rogers and Shaw. You might want to take the money and run if you hold Shaw. Both are fairly priced.

TOP PICK

Believes the deal with Rogers will close. Election could upset the apple cart, but polls don't expect a change in government. Even if there is, huge precedent for the deal to close. Good risk/reward right now, in a market where there's a lot of risk. Good place to park some cash while we wait for the deal. Yield is 3.21%. (Analysts’ price target is $39.18)

PAST TOP PICK

(A Top Pick Sep 03/20, Up 52%) Likes telecom in general. He sold out into the Rogers bid. If the deal doesn't go through, downside might be 30% or more.

PARTIAL SELL

High likelihood of the deal going through. If the deal doesn't go through, would have fairly significant downside. One strategy might be to sell a partial position, and put in another telco. Canadian telcos are steady businesses, modest growth, nice dividends.

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