As of June 14, 2025, Rogers Communications Inc's estimated intrinsic value ranges from $37.93 to $137.71 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $67.86 | +80.7% |
| Discounted Cash Flow (5Y) | $61.39 | +63.4% |
| Dividend Discount Model (Multi-Stage) | $37.93 | +1.0% |
| Dividend Discount Model (Stable) | $40.09 | +6.7% |
| Earnings Power Value | $137.71 | +266.7% |
Is Rogers Communications Inc (RCI.B.TO) undervalued or overvalued?
With the current market price at $37.56, 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 Rogers 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 | 0.6 | 0.88 |
| Cost of equity | 6.2% | 9.5% |
| Cost of debt | 4.5% | 6.8% |
| Tax rate | 26.7% | 26.7% |
| Debt/Equity ratio | 2.36 | 2.36 |
| After-tax WACC | 4.2% | 6.3% |
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 | $61 | $79,700M | 80.4% |
| 10-Year Growth | $68 | $83,183M | 64.0% |
| 5-Year EBITDA | $52 | $74,705M | 79.1% |
| 10-Year EBITDA | $69 | $83,631M | 64.2% |
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 | $6,055M |
| Discount Rate (WACC) | 6.3% - 4.2% |
| Enterprise Value | $95,782M - $145,753M |
| Net Debt | $46,672M |
| Equity Value | $49,110M - $99,081M |
| Outstanding Shares | 538M |
| Fair Value | $91 - $184 |
| Selected Fair Value | $137.71 |
| Metric | Value |
|---|---|
| Market Capitalization | $20209M |
| Enterprise Value | $66881M |
| Trailing P/E | 11.50 |
| Forward P/E | 11.51 |
| Trailing EV/EBITDA | 8.20 |
| Current Dividend Yield | 363.21% |
| Dividend Growth Rate (5Y) | -7.54% |
| Debt-to-Equity Ratio | 2.36 |
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% | $20.36 |
| Discounted Cash Flow (5Y) | 25% | $15.35 |
| Dividend Discount Model (Multi-Stage) | 20% | $7.59 |
| Dividend Discount Model (Stable) | 15% | $6.01 |
| Earnings Power Value | 10% | $13.77 |
| Weighted Average | 100% | $63.08 |
Based on our comprehensive valuation analysis, Rogers Communications Inc's weighted average intrinsic value is $63.08, which is approximately 67.9% above the current market price of $37.56.
Key investment considerations:
Given these factors, we believe Rogers Communications Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.