As of December 15, 2025, Cogeco Communications Inc's estimated intrinsic value ranges from $83.01 to $288.08 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $168.58 | +154.0% |
| Discounted Cash Flow (5Y) | $145.12 | +118.7% |
| Dividend Discount Model (Multi-Stage) | $84.48 | +27.3% |
| Dividend Discount Model (Stable) | $83.01 | +25.1% |
| Earnings Power Value | $288.08 | +334.1% |
Is Cogeco Communications Inc (CCA.TO) undervalued or overvalued?
With the current market price at $66.37, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Cogeco Communications Inc's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.7 | 1.22 |
| Cost of equity | 6.7% | 11.6% |
| Cost of debt | 5.2% | 6.3% |
| Tax rate | 18.1% | 19.2% |
| Debt/Equity ratio | 1.62 | 1.62 |
| After-tax WACC | 5.2% | 7.6% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $145 | $10,616M | 74.4% |
| 10-Year Growth | $169 | $11,608M | 57.3% |
| 5-Year EBITDA | $100 | $8,707M | 68.7% |
| 10-Year EBITDA | $129 | $9,948M | 50.2% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $1,029M |
| Discount Rate (WACC) | 7.6% - 5.2% |
| Enterprise Value | $13,577M - $19,744M |
| Net Debt | $4,481M |
| Equity Value | $9,096M - $15,264M |
| Outstanding Shares | 42M |
| Fair Value | $215 - $361 |
| Selected Fair Value | $288.08 |
| Metric | Value |
|---|---|
| Market Capitalization | $2806M |
| Enterprise Value | $7287M |
| Trailing P/E | 8.70 |
| Forward P/E | 7.69 |
| Trailing EV/EBITDA | 5.15 |
| Current Dividend Yield | 551.36% |
| Dividend Growth Rate (5Y) | 6.33% |
| Debt-to-Equity Ratio | 1.62 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $50.57 |
| Discounted Cash Flow (5Y) | 25% | $36.28 |
| Dividend Discount Model (Multi-Stage) | 20% | $16.90 |
| Dividend Discount Model (Stable) | 15% | $12.45 |
| Earnings Power Value | 10% | $28.81 |
| Weighted Average | 100% | $145.01 |
Based on our comprehensive valuation analysis, Cogeco Communications Inc's intrinsic value is $145.01, which is approximately 118.5% above the current market price of $66.37.
Key investment considerations:
Given these factors, we believe Cogeco Communications Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.