There was good news out of Canadian telecom giant Rogers Communications (TSE:RCI.B) today, as it looked for brisk free cash flow (C$2.9 billion to C$3.1 billion) on the back of a growing subscriber base. Yet, that wasn’t good enough for investors, who sent shares down fractionally in Friday afternoon’s trading.
Basically, Rogers noted that immigration into Canada is on the rise, and that, in turn, means that all those new immigrants will need wireless and internet services. While they may not all buy from Rogers, some will, and that means more customers than before. Canada has been eagerly courting newcomers, looking to bring in 465,000 residents in 2023, and hopes to pull in nearly a million by the end of 2025. That’s going to be quite a bit of extra traffic for Canadian telecom, which should have given Rogers a boost.
Not Much Reason for the Drop
As for reasons why Rogers was in decline, well, there really aren’t any. Not offhand, anyway; Rogers’ recent earnings report proved solid enough. It also recently concluded a network slicing trial that’s showing some promise for giving emergency personnel rapid access to the network in emergencies. Furthermore, Rogers is stepping up 5G access to commonly underserved rural communities.
About the only burr under Rogers’ collective saddle right now is a noticeable loss in subscribers due to rising costs. But with the company seemingly unconcerned about such developments, it may not actually be anything to worry about.
Is Rogers Communications a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on RCI.B stock based on 10 Buys assigned in the past three months, as indicated by the graphic below. After a 0.34% loss in its share price over the past year, the average RCI.B price target of C$76.09 per share implies 20.95% upside potential.
