Download PDF

1. Company Snapshot

1.a. Company Description

Cogeco Communications Inc.operates as a communications corporation in North America.It operates in two segments, Canadian Broadband Services and American Broadband Services.


The company offers Internet, video, and telephony services to residential and business customers through its two-way broadband fiber networks.It provides Internet services using modems, Wi-Fi gateways, and extenders either on a rental basis or as part of the Internet service package; video services on a subscription basis; home phone services using Internet protocol (IP); local and long-distance calling services; broadband Internet services; and IP based telephony services and other network connectivity services delivered over fiber optic connection to larger businesses.The company serves the primary service units, Internet, video, and telephony service customers.


It offers cable operator services under the Cogeco Connexion name in Québec and Ontario, and in the United States under the Atlantic Broadband brand.The company was formerly known as Cogeco Cable Inc.and changed its name to Cogeco Communications Inc.


in January 2016.Cogeco Communications Inc.was founded in 1972 and is headquartered in Montreal, Canada.


Cogeco Communications Inc.operates as a subsidiary of Cogeco Inc.

Show Full description

1.b. Last Insights on CCA

The recent 3-month performance of Cogeco Communications Inc. was negatively impacted by a disappointing earnings release, which saw the company miss EPS estimates by 8.7%. The Q3 2025 financial results announced on July 16, 2025, revealed a decline in profitability, likely due to increased competition in the Canadian telecom market. Furthermore, the launch of its mobile service in 13 markets on July 30, 2025, may have also contributed to the company's recent struggles, as it may have diverted resources away from other business segments.

1.c. Company Highlights

2. Cogeco's Q3 Earnings: A Mixed Bag

Cogeco Inc. and Cogeco Communications Inc. reported their Q3 2025 earnings, with a mix of positive and negative trends. Revenue declined by 4.5% in constant currency, with a 1.8% decline in Canada and a 6.6% decline in the U.S. Adjusted EBITDA declined by 1.3% in constant currency, with a stable performance in Canada and a 3.7% decline in the U.S. The company's EPS came in at $1.82, missing estimates of $1.97. Despite the challenges, the company generated $600 million in free cash flow and reported a net debt to adjusted EBITDA ratio of 3.1 turns.

Publication Date: Jul -17

📋 Highlights
  • Canadian Internet Subscriber Growth: Cogeco added 9,400 new Internet subscribers in Canada, driven by a growing Internet subscriber base.
  • Free Cash Flow Performance: The company generated $600 million in free cash flow for fiscal 2027.
  • Revenue Decline: Revenue in Canada declined by 1.8%, while revenue in the U.S. declined by 6.6%.
  • Adjusted EBITDA Decline: Adjusted EBITDA declined by 1.3% in constant currency in Canada, and 3.7% in constant currency in the U.S.
  • Net Debt to Adjusted EBITDA Ratio: The company reported a net debt to adjusted EBITDA ratio of 3.1 turns.

Financial Performance

The company's revenue decline was largely driven by competitive pressures in the U.S., where the company faces challenges from larger players like Comcast and Charter. In Canada, the company added 9,400 new Internet subscribers, driven by a growing Internet subscriber base. The company's adjusted EBITDA margin was relatively stable, with a decline of only 1.3% in constant currency. According to CFO Patrice Ouimet, the company still expects to finish the year stable on EBITDA, within a certain range, despite a tough comp in Q4.

Operational Trends

The company's Canadian wireless launch is exclusive to customers buying wireline services, targeting low to mid data users with a time-limited launch bonus. The company is optimistic about improvements in the coming quarters, driven by the transformation of its sales and marketing capabilities, especially in the U.S. Cogeco Media's radio advertising market faced challenges, but revenue increased during the quarter, helped by growth in digital advertising solutions. The company urges the federal cabinet to address the Canadian regulatory environment, which it believes favors telecom giants at the expense of regional players.

Valuation and Outlook

At current prices, Cogeco trades at a P/E ratio of 8.58, a P/B ratio of 0.89, and a dividend yield of 5.42%. The company's EV/EBITDA ratio is 5.34, and its free cash flow yield is 17.19%. With a ROIC of 7.74% and an ROE of 10.71%, the company's valuation metrics suggest that there may be opportunities for growth. Analysts estimate next year's revenue growth at -2.1%, which may be a challenge for the company to overcome.

3. NewsRoom

Card image cap

Cogeco Communications to Participate in the Desjardins Toronto Conference

Nov -17

Source:

Card image cap

Cogeco Communications (TSE:CCA) Is Increasing Its Dividend To CA$0.987

Nov -07

Source:

Card image cap

Cogeco Announces Q4 2025 Financial Results

Oct -30

Source:

Card image cap

Cogeco Communications announces Q4 2025 financial results

Oct -29

Source:

Card image cap

Cogeco Expands Internet and Mobile Services in Key Markets Could Be a Game Changer For Cogeco Communications (TSX:CCA)

Oct -23

Source:

Card image cap

A Look at Cogeco Communications (TSX:CCA) Valuation Following Its Major Mobile Service Expansion

Oct -23

Source:

Card image cap

Retail investors who hold 37% of Cogeco Communications Inc. (TSE:CCA) gained 4.2%, institutions profited as well

Oct -23

Source:

Card image cap

/C O R R E C T I O N -- Cogeco Communications Inc./

Oct -23

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.50%)

6. Segments

American Telecommunications

Expected Growth: 5%

Cogeco Communications Inc.'s American Telecommunications segment growth is driven by increasing demand for high-speed internet and data services, expansion into new markets, and strategic acquisitions. Additionally, investments in network infrastructure and technology upgrades have improved service quality, attracting and retaining customers. Furthermore, the shift towards remote work and online learning has accelerated demand for reliable and fast connectivity, contributing to the segment's 5% growth.

Canadian Telecommunications

Expected Growth: 0%

Cogeco Communications Inc.'s Canadian Telecommunications segment has stagnant growth due to intense competition, saturated market, and limited opportunities for expansion. Additionally, high capital expenditures for network maintenance and upgrades, coupled with declining voice and data services revenue, contribute to the flat growth.

7. Detailed Products

Internet Services

High-speed internet services for residential and business customers, offering various speed tiers and data plans.

Television Services

Digital TV services offering a range of channels, on-demand content, and features like pause and rewind live TV.

Phone Services

Home phone services with features like call display, voicemail, and long-distance calling.

Fibre-Based Services

High-speed fibre-optic internet, TV, and phone services for businesses and residential areas.

Data Centre Services

Colocation, cloud, and managed services for businesses, offering secure and reliable data centre solutions.

Managed IT Services

Managed IT services, including network monitoring, cybersecurity, and IT consulting for businesses.

Fibre-Based Ethernet Services

High-speed, dedicated Ethernet services for businesses, offering point-to-point and point-to-multipoint connections.

8. Cogeco Communications Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Cogeco Communications Inc. is medium due to the availability of alternative telecommunications services from competitors.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of negotiating power and the high switching costs associated with changing telecommunications providers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of multiple suppliers of network equipment and services, but the high costs associated with switching suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry, including the need for significant capital investments and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established competitors in the telecommunications industry, leading to aggressive pricing and marketing strategies.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 63.03%
Debt Cost 6.25%
Equity Weight 36.97%
Equity Cost 6.31%
WACC 6.27%
Leverage 170.51%

11. Quality Control: Cogeco Communications Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Cogeco

A-Score: 7.0/10

Value: 9.3

Growth: 5.9

Quality: 4.5

Yield: 9.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

View Full Report
Stock-Card
Cogeco

A-Score: 6.6/10

Value: 8.5

Growth: 5.3

Quality: 5.6

Yield: 8.0

Momentum: 3.5

Volatility: 9.0

1-Year Total Return ->

View Full Report
Stock-Card
TDS

A-Score: 5.4/10

Value: 8.1

Growth: 3.2

Quality: 3.1

Yield: 4.0

Momentum: 9.0

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
ATN International

A-Score: 4.5/10

Value: 8.8

Growth: 4.6

Quality: 2.7

Yield: 7.0

Momentum: 0.0

Volatility: 3.7

1-Year Total Return ->

View Full Report
Stock-Card
Crexendo

A-Score: 4.4/10

Value: 1.7

Growth: 7.7

Quality: 7.0

Yield: 0.0

Momentum: 7.0

Volatility: 3.0

1-Year Total Return ->

View Full Report
Stock-Card
Cable One

A-Score: 3.6/10

Value: 7.6

Growth: 4.1

Quality: 2.8

Yield: 5.0

Momentum: 0.0

Volatility: 2.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

67.07$

Current Price

67.07$

Potential

-0.00%

Expected Cash-Flows