Analyst Matthew Griffiths of Bank of America Securities reiterated a Hold rating on Rogers Communication (RCI – Research Report), retaining the price target of C$50.00.
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Matthew Griffiths has given his Hold rating due to a combination of factors impacting Rogers Communication’s performance. The wireless segment is currently facing challenges with volumes and pricing under pressure, and there is no immediate indication of a positive turnaround. Despite the company’s efforts to address high leverage through a significant structured equity transaction, which is seen as valuation neutral, and its strategic move to acquire BCE’s stake in sports assets, these actions do not provide a strong enough catalyst for a rating upgrade.
Additionally, the expectations for post-paid net additions appear overly optimistic, as previous quarters have shown a trend of missing forecasts. While the Cable segment is expected to see margin expansion, revenue remains flat due to offsetting factors. The Media segment shows some promise with anticipated revenue growth from hockey playoffs, but this is tempered by costs such as Major League Baseball player salaries. These mixed signals contribute to maintaining a Hold rating.
RCI’s price has also changed slightly for the past six months – from $30.360 to $29.080, which is a -4.22% drop .