Cogeco Communications Stock Forecast and Analysis:
Cogeco Communications Inc is a Canadian company that provides various communication services such as internet, television, and phone. According to forecasts from 8 analysts, the average target price for Cogeco Communications Inc’s stock over the next 12 months is CAD 93.79. This means that analysts on average expect the stock to increase in value and reach CAD 93.79 in the next year. Additionally, the average analyst rating for the stock is “Buy,” indicating that analysts believe the stock is a good investment.
Furthermore, Stock Target Advisor has conducted its own analysis of Cogeco Communications Inc’s stock and has determined that it is “Bullish.” This is based on 12 positive signals and 5 negative signals, indicating that the company’s overall performance and outlook are favorable.
Currently, Cogeco Communications Inc’s stock price is CAD 81.64, which has changed by +2.43% over the past week, +7.73% over the past month and -17.73% over the last year. The stock price has increased over the past week and month but decreased over the last year.
Analyst Coverage:
The analyst rating for Cogeco Inc. (CCA:CA) CCA:TSX) as of January 13, 2023 is a “Sector Perform” rating from Scotiabank Capital. The rating is accompanied by a price target of CAD 90. A “Sector Perform” rating is typically given to a stock that is expected to perform in line with the overall market or sector.
Cogeco Communications News:
Cogeco Communications Inc., a leading cable company, reported strong financial results for the first quarter of the fiscal year, with an increase in both profit and revenue compared to the previous year. However, the company has revised its expectations for the full financial year, indicating a more cautious outlook.
In its earnings release, Cogeco Communications announced that it now expects revenue for 2023 to grow between 0.5-2% on a constant currency basis, a reduction from the previous projection of 2-4% growth. Additionally, the company’s adjusted EBITDA is now expected to grow between 0.5-2% on a constant currency basis, compared to the previous guidance of 1.5-3.5% growth for the full year.
Despite the lowered expectations, Cogeco Communications reported a profit of $111.5 million for the quarter ended November 30th, an increase of $4.7 million or 4.4% from the previous year. The quarter also saw revenue of $762.3 million, a 6.1% or 2.3% increase on a constant currency basis.
The company attributes the lower expectations to ongoing challenges in the cable industry, including increased competition and regulatory headwinds. Despite these challenges, Cogeco Communications remains confident in its ability to drive growth and maintain its position as a leading player in the industry.
Overall, the company’s first quarter results demonstrate its ability to deliver solid financial performance despite a challenging operating environment. The company will continue to focus on delivering value to its shareholders, while also investing in its business to drive growth in the future.
Positive Fundamentals of Cogeco Communications:
Cogeco Communications stock has demonstrated superior total returns, outperforming its sector peers on average annual total returns basis in the past 5 years.
The stock is also underpriced compared to its peers on a price to book value and price to cash flow basis, and is in the top quartile in these metrics. This suggests that the stock may be undervalued and may be a good investment opportunity.
The company management has also delivered superior return on equity, capital utilization, and return on assets in the most recent 4 quarters, placing it in the top quartile among its peers. Additionally, the company has had positive total and free cash flow in the most recent four quarters.
The stock also has shown top quartile earnings and revenue growth in the previous 5 years compared to its sector, and has a high gross profit to asset ratio, which is a popular measure among value investors that indicates superior returns in the long run. However, it’s always important to check the financial performance of a company before making an investment decision.
Negative fundamentals of Cogeco Communications:
Cogeco Communications is a stock that has a low market capitalization, making it a smaller entity in its sector with below median market capitalization. This could make it less stable in the long run, unless it has a unique technology or market which can help it grow or get acquired in future.
Additionally, the stock is highly volatile, with total returns for the company being above median for its sector over the past 5 years. This means that investors should be aware that the stock may be risky.
The stock is overpriced compared to its earnings, trading high compared to its peers on a price to earning basis and is above the sector median. Moreover, the company is also highly leveraged, which means it has a high level of debt compared to its equity. This can be an indication of financial risk, but it’s important to check the news and look at the company’s sector and management statements before making a decision.
Lastly, the stock is also overpriced on a free cash flow basis, and is priced above the median for its sectors, which means that investors should proceed with caution if they are considering to buy.
