Earlier this week, Rogers Communications ($TSE:RCI.B) purchased BCE’s (TSE:BCE) entire stake in the Maple Leaf Sports & Entertainment, the group that manages the Toronto Maple Leafs, among others. That left some wondering if Rogers was preparing to put together a sports dynasty, a field that is increasingly attractive among media properties. That proved less than compelling to investors, though, as shares are trading lower than on September 17 before the deal was announced.
Rogers dropped C$4.7 billion on the deal, reports noted, and that makes Rogers look like the big wheel in Toronto sports. Ownership includes major brands like the Maple Leafs, of course, but also the Toronto Raptors and the Toronto Blue Jays. In fact, some suggested that, at some point, a complete initial public offering (IPO) might follow.
While such a plan has not been concretely announced yet, it may be in the works. Rogers has owned the Blue Jays for the last 25 years, using it as part of a super-bloc along with the Maple Leafs now. One of the biggest voices suggesting such an IPO is Jerome Dubreuil, analyst with Desjardins, who offered a research note suggesting that such a play would be a “slam dunk.”
But What About the Toronto Argonauts?
This move in turn has left some quite concerned. Particularly those who follow the Canadian Football League (CFL) and its Toronto Argonauts team. With Rogers now in charge of Maple Leafs, some are pointing out that Rogers has had its eye on the National Football League (NFL) for some time now, which could be detrimental to the CFL.
The question now is whether Rogers will put more investment behind the Argonauts, and build a CFL franchise, or potentially look to make a play for the NFL instead. Toronto itself seems to have an eye on being in the “top league,” as noted by Cosmos Sports & Entertainment president Cary Kaplan. While the answer remains to be seen, it could be a very big move in sports…one way or the other.
Is Rogers Communications a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on TSE:RCI.B stock based on seven Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 2.64% rally in its share price over the past year, the average TSE:RCI.B price target of C$66.69 per share implies 23.22% upside potential.
