Rogers Communications downgraded to Sector Perform from Outperform at Scotiabank

Scotiabank downgraded Rogers Communications (RCI) to Sector Perform from Outperform with a price target of C$50, down from C$58. Rogers’ cash generation has been drained by Rogers Bank over the last two years, and the ongoing costs to finance the new credit card more than offset the relative churn reduction that was likely gained from this endeavor, the analyst tells investors in a research note. Should Rogers be able to close its infrastructure deal, it will materially improve leverage, but this will not impact real cash generation nor change the trends that the wireless business is facing, the firm says.