The Canadian telecom sector has faced considerable pressure over the past two years, but Rogers Communications (TSX: RCI.B) has recently shown signs of life with a surprising rally from its multi-year lows around $32. The stock has climbed over 45% off its 52-week bottom, sparking interest among dividend investors. But is now the right time to jump in?
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While the rebound is encouraging, some caution may be warranted. The stock recently slipped 3.5% during a volatile trading session, suggesting potential for a more attractive entry point. Currently, Rogers offers a 4% dividend yield, which is well-covered and holds potential for future growth. That said, industry headwinds remain a concern.
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Rogers’ unique positioning in Canadian sports broadcasting — especially through its long-term NHL deal — gives it a resilient revenue stream, particularly as dedicated hockey fans continue paying rising subscription fees to follow their teams via Sportsnet. This sports moat could help support the company’s cash flows and dividend growth moving forward.
Still, wireless growth remains sluggish, and increased competition may put pressure on margins. While the stock is attractively valued at around 17.1 times trailing earnings, the long-term outlook depends on Rogers’ ability to maintain pricing power and navigate the evolving telecom landscape.
All things considered, Rogers has solid assets, stable cash flow, and a reliable dividend. However, given recent gains, potential investors may want to wait for a pullback — ideally in the $40–$42 range — before initiating a position.
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