Fear not, Rogers Communications Inc. will not be sunk by wireless upstarts in this or any other year in the near future, analysts say.
The company, which already has one of the largest slices of the market share pie, will likely continue to see growth in the maturing wireless market, despite assaults in recent months from new players such as Wind Mobile, Phillip Huang with UBS said in a note.
"While we do not believe new entrants will have any significant direct impact on Rogers' financial results in 2010, we believe they will create negative sentiments through the year," he said. "We currently see heightened sentiment risks through the spring as several new entrants perpare to launch esrvices and expand their coverage."
Instead, Mr. Huang calls Rogers a "fundamentally strong company" due to its commitment to returning capital to shareholders, maintaining a Buy rating while upping his price target to $39 from $36.
"An established track record of annual dividend growth and share repurchases will help lower the stock's risk profile, appeal to a broader base of investors, and provide downside support," he said.
Meanwhile Maher Yaghi, analyst with Desjardins Securities, said wireless will continue to drive growth in the telecommunications sector in Canada, and Rogers remains "the" player in wireless.
"Many investors used the recent run-up in the stock price ahead of the quarterly results to take profits," he said. "However, the shares are trading at an attractive level, and over the long term we expect continued good performance from the company driven by its leadership in wireless and a balance sheet that provides a high degree of flexibility."
He pegs Rogers with a Buy-Average Risk rating and $38.40 target price.