Undervalued Large-Cap Communication Services Stocks on TSE November 2023

November 03, 2023

November 2023

QBR.B:TSE

Communication Services

Communication Services Sector

The communication services sector includes companies that provide phone and internet services via traditional fixed-line, broadband or wireless networks.

Toronto Stock Exchange

The Toronto Stock Exchange (TSE) is a stock exchange located in Toronto, Ontario, Canada. It is the 10th largest exchange in the world and the third largest in North America based on market capitalization.

Our Valuation

A stock is considered undervalued if it trades at a discount to our valuation. To determine a stock’s intrinsic value, we developed an algorithm that uses 6 valuation models to determine the value of a company.* To learn more about stockcalc’s valuation methods, click here.

Undervalued Communication Services stocks

Stocks in this category are held primarily for potential income and capital appreciation.

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Symbol	Name	Close Price ($)	Valuation ($)	Difference (%)	Average Vol (30D)	Market Cap ($M)	Yield (%)	P/E Ratio
QBR.B	Quebecor	28.78	35.05	21.80	364840	6798	4.17	10.8
CCA	Cogeco Communications	55.16	67.06	21.58	52605	2473	5.63	6.1
QBR.A	Quebecor	30.60	35.02	14.44	626	7228	3.92	11.5
T	TELUS	22.78	23.75	4.25	2194357	33077	6.27	27.8
BCE	BCE	52.52	54.57	3.90	1955911	47925	7.28	20.8
RCI.A	Rogers Communications	52.30	53.96	3.17	1128	27719	3.82	17.8
RCI.B	Rogers Communications	52.43	53.32	1.69	764699	27788	3.81	17.8

All data provided as at market close October 31, 2023.

Company Details

Quebecor

QBR.B:TSX

Close Price

28.78

Our Valuation

35.05

% Difference

21.80

Market Cap ($M)

6798

P/E Ratio

10.8

Quebecor primarily provides telecom services in Quebec, where it has roughly 1.7 million internet subscribers—equating to a penetration rate of about 50% in its footprint—and over 3 million mobile subscribers, including more than 20% wireless market share in Quebec. With the acquisition of Freedom Mobile in April 2023, Quebecor also has more than 1.5 million mobile subscribers in Ontario, British Columbia, and Alberta.

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Cogeco Communications

CCA:TSX

Close Price

55.16

Our Valuation

67.06

% Difference

21.58

Market Cap ($M)

2473

P/E Ratio

6.1

Cogeco Communications Inc is a communication corporation. The company is a cable operator in North America operating in Canada. It provides residential and business customers with internet, video, and telephony services with broadband fibre networks. The reportable segments of the company are Canadian broadband services and American broadband services. In internet services, the company offers internet packages with download speeds of up to 120mbps.

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Quebecor

QBR.A:TSX

Close Price

30.60

Our Valuation

35.02

% Difference

14.44

Market Cap ($M)

7228

P/E Ratio

11.5

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TELUS

T:TSX

Close Price

22.78

Our Valuation

23.75

% Difference

4.25

Market Cap ($M)

33077

P/E Ratio

27.8

Telus is one of the Big Three wireless service providers in Canada, with its nearly 10 million mobile phone subscribers nationwide constituting about 30% of the total market. It is the incumbent local exchange carrier in the western Canadian provinces of British Columbia and Alberta, where it provides internet, television, and landline phone services. It also has a small wireline presence in eastern Quebec.

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BCE

BCE:TSX

Close Price

52.52

Our Valuation

54.57

% Difference

3.90

Market Cap ($M)

47925

P/E Ratio

20.8

BCE provides wireless, broadband, television, and landline phone services in Canada. It is one of the big three national wireless carriers, with its roughly 10 million customers constituting about 30% of the market. It is also the ILEC (incumbent local exchange carrier—the legacy telephone provider) throughout much of the eastern half of Canada, including in the most populous Canadian provinces: Ontario and Quebec.

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Rogers Communications

RCI.A:TSX

Close Price

52.30

Our Valuation

53.96

% Difference

3.17

Market Cap ($M)

27719

P/E Ratio

17.8

Rogers Communications is the largest wireless service provider in Canada, with its more than 10 million subscribers equating to one third of the total Canadian market. Its wireless business accounted for more than half of total revenue and has increasingly been providing a bigger portion of total company sales over the last several years.

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Rogers Communications

RCI.B:TSX

Close Price

52.43

Our Valuation

53.32

% Difference

1.69

Market Cap ($M)

27788

P/E Ratio

17.8

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