On Jun 28, we maintained our Neutral recommendation on
Rogers Communications Inc.
). In the recently concluded first quarter, the company missed
both the top and the bottom line of the Zacks Consensus Estimate.
Rogers was the first company in Canada to launch LTE (Long Term
Evolution) network. Initially, the company deployed LTE network
in 90 cities of Canada, covering over 60% of Rogers' footprint.
The company also offered a variety of LTE-enabled smartphones.
Further, the company teamed up with a Hong Kong-based carrier to
offer the first LTE roaming service to its subscribers in Hong
Kong and expects to extend the service to other countries by
Rogers received CRTC's approval to gain complete control over
sports television network - Score Media Inc. - Canada's
third-largest specialty sports channel. The acquisition of Score
Media Inc. will provide Rogers the right to access television
assets of the Score Television Network along with an additional
6.6 million television subscribers, thereby driving revenues.
Softness in the advertising market due to lack of investment in
TV content coupled with increased competition in the cable TV
business after BCE Inc. entered into the Canadian cable market,
may hurt profitability in the near future. Moreover, the Canadian
regulatory authority's decision to grant licenses to four new
operators in order to improve national wireless service,
subsequently increasing competition in the Canadian wireless
market, may further act as a headwind for Rogers.
Rogers Communications carries a Zacks Rank #3 (Hold).
Other Stocks Outlook in Related Industries
Other stocks in this sector like
Sprint Nextel Corp.
) are set to gain from the extensive/increasing LTE deployment in
the upcoming days. These companies will declare their
fourth-quarter results next month.
Currently, TELUS Corporation has a Zacks Rank #2 (Buy) while both
Sprint and BCE Inc. have a Zacks Rank #3 (Hold).
BCE INC (BCE): Free Stock Analysis Report
ROGERS COMM CLB (RCI): Free Stock Analysis
SPRINT NEXTEL (S): Free Stock Analysis Report
TELUS CORP (TU): Free Stock Analysis Report
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