Corus Entertainment Inc. (Symbol - CJR.B)

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Taggart
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Corus Entertainment Inc. (Symbol - CJR.B)

Post by Taggart »

For those who haven't noticed, Corus Entertainment took a nosedive over the last two days.

Decline takes it's valuation back to July 2013 level.

Details at Reuters.

Just added shares a month ago. Bad timing on my part.
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AltaRed
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by AltaRed »

I've had alerts go off twice in a few days. Not a stock I have followed much due to questions about long term viability of the business model with competing alternatives.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by scomac »

Decision time for me with this stock. I've owned it for a couple of years and made nothing. I was somewhat surprised at the reaction to the news, but there is now a nice opportunity to add if that is one's proclivity. Unfortunately for me I have other names that are also in the doghouse, notably a couple of REITs and an O&G service co. that has been trashed with the breakdown in oil prices. It would be easy enough to flush the lot, but what to replace them with? What opportunities that were on offer were snapped up rather quickly.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by JaydoubleU »

I've owned Corus for 3 or 4 years. Road it up, sold some, bought more when it dropped, watched it rise and fall again. I'm about even now, not including divvies.

Like Scomac, I was debating whether to add at this level. The company is actually forecasting increased free cash flow this year, and TD predicts a dividend boost in January, on top of the already-sweet 5% yield.

However, I am a bit concerned about the business which, in the words of the TDW report, seems to be "running to stand still"; except for BCE, companies in the media space haven't done so well for me. It seems the digital revolution just keeps leaving victims in its wake, as Altared suggests. Corus depends on advertising, and traditional forms of advertising are slowly disappearing. I'm not sure how to evaluate Corus' radio and TV assets in this situation. I do NOT want another Torstar in my portfolio :roll:

Corus is always said to be an obvious takeover candidate, the likely suitor being its parent, Shaw. However, the CRTC is increasingly watchful--they gave BCE a lot of grief over Astral, and I'm not sure they'd let the deal go down, nor am I sure Shaw would want to take Corus in any longer. They just spent a bundle buying a US data-center provider. I wouldn't invest counting on a buyout, but its a nice sweetener to have on the side, as it was for BA.

Still on the fence, in sum.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by AltaRed »

I was considering a bid yesterday but then I reminded myself of my experience with a partial position in YLO.UN. Not the same of course, but could have similar issues over the longer term.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Taggart »

With Jay's reminder of a "potential" dividend increase from Corus in January, I'll just wait and see if there's any vote of confidence from management, and I'll decide whether to add to the portfolio or not at that time.

With AltaRed's reminder of YLO, I won't be doing thumbsucking and watch this stock go down to pennies on the dollar, like I did with that one. I learned my lesson. It won't happen again. Any sign of a dividend cut from Corus or indeed from any other stock I own in the portfolio, and I'll be totally out of it right away. Then it's definitely outside of my circle of competence. I'll then leave it to the deep value and turnaround investors to decide.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Arby »

I'm continuing to hold my position in Corus, but I don't plan to add to my holdings. I think the dividend is safe, based on earnings projections from analysts. On the quarterly conference, management gave a pretty good indication that the dividend will be increased in January. They said they have a strategy of allocating 50% of FCF to dividends, and FCF is up from last year.

The decrease in radio advertising revenue is a concern, but I'm not sure if it was due to a secular shift of advertising dollars towards the internet. FWIW, the following chart from PWC indicates that radio advertising revenues will stay pretty steady between 2013 and 2018.
PwC-US-Ad-Media-Market-Sizes-2013-v-2018-June2014.png
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by JaydoubleU »

No word on the Corus--Shaw deal?

http://www.corusent.com/news/corus-ente ... isition-2/

I still hold Corus shares, though I can't say I'm very happy about the one year total return of --50%. I am actually wondering if I should add to my holdings to lower my ACB and capture a very attractive high yield, or just hold and hope the price will one day recover.

The company recently maintained the dividend, and many analysts claim the dividend is safe. But I've seen that show before, and with a current yield of 11.72%, the market would appear to disagree.

The guys at "Investment Reporter" recently raised their rating on Corus from hold to buy, and also feel the dividend is well-covered by free cash flow. The upgrade is due to an improved outlook following the Shaw Media acquisition.

https://www.investmentreporter.com/sour ... ter-editor

Any out there buying CJR.B? Holding? Wouldn't touch it with a ten-foot pole?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

I have Telus on my watch list. I will look at this as well.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by AltaRed »

JaydoubleU wrote:Any out there buying CJR.B? Holding? Wouldn't touch it with a ten-foot pole?
As alluded to upthread, 'pick and pay' is coming and that will decimate a number of offerings, but perhaps strengthen others. There is a lot of weak product in the 'packages' now sold. When subscribers can elect to dump the losers and just get the 1-2 they want out of a current 6 channel package, there will be a shaking out of product. I really would not speculate on how Corus will fair overall in the reset of this market.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Shakespeare »

I wonder how much restructuring will happen when, as I suspect, little or no money will be saved.

I haven't bothered restructuring my Bell satellite because I'm grandfathered into a service (the former CBC Galaxy, where it sits most of the time playing classical music with the TV off) which I don't want to lose.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Taggart »

I make it a rule not to add to any equity investment I own after it skips a scheduled annual dividend increase. Corus broke that rule last October with no announced declaration of a dividend increase for 2016. I no longer have any shares in Corus. A stock with negative earnings and a double digit dividend yield doesn't entice me to buy into it again. Perhaps in the future Corus may be a potential purchase if something positive happens to it's earnings and dividend growth starts up again, but certainly not right now, at least not for me.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

How to generate an additional $50 million for the Shaw family!

I am experiencing them trying to extract more money from subscribers to their Pick and Pay system.
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Shakespeare
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Shakespeare »

I am experiencing them trying to extract more money from subscribers to their Pick and Pay system.
Of course you are. Did you ever think pick n pay would be cheaper?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

Shakespeare wrote:
I am experiencing them trying to extract more money from subscribers to their Pick and Pay system.
Of course you are. Did you ever think pick n pay would be cheaper?
Wasn't that the point of the exercise? Paying for what you watch rather than bloated packages with dozens of useless channels?
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Shakespeare
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Shakespeare »

The point was to give consumers more freedom to choose, not drop their costs.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by AltaRed »

Shakespeare wrote:The point was to give consumers more freedom to choose, not drop their costs.
And we shall see how disciplined consumers are in actually cutting the number of subscriptions. I actually think I would be able to cut the number of channels we suscribe too sustantially, but alas, SO tends to like stuff I wouldn't pay anything for, and vice versa. Guess who loses that battle?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by JaydoubleU »

I am more interested in this Shaw Media deal and the opposition to it from Catalyst:

http://business.financialpost.com/news/ ... s-analysts

And curious to know why Corus has surged almost 10% in the last 5 days . . . There seems to be a lot of pushing and shoving behind the scenes.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

This deal is reminiscent of The Big Short. Shaw buys Wind for $1.6 billion when it was apparently valued at $300 million. How do the square that circle and close the $1.3 billion gap? By having Corus overpay for some Shaw assets and ignoring the costs to Corus of financing the extra money.

The stock price obviously reflects the inflated value of the asset. Insider manipulation in full view of no securities regulator! Isn't Canada great?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by JaydoubleU »

I like your take, Keith, but as a Corus shareholder, I feel I am being taken out behind the shed, as my uncle would've put it :x
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

Maybe you should sell before reality sets in?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by Profit not Prophet »

http://business.financialpost.com/news/ ... -shaw-deal

“One lone shareholder shouting in the wilderness does not a public interest make,” said Larry Lowenstein, a partner with Osler, Hoskin & Harcourt LLP, who appeared on behalf of Corus.

Slowly brewing up maybe. Cheers to Capitalism ?
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by JaydoubleU »

Maybe you should sell before reality sets in?
I still feel that Corus owns valuable assets and the stock price isn't reflecting that. What I resent is the feeling that these deals are a Shaw insider manipulation game--Corus shareholders to pay for Shaw's acquisition of Wind, and at a time when Corus shares are weak. I can't say whether the acquisition of Shaw Media is the "game-changer" it is purported to be, or just the dumping of junk Shaw doesn't want into Corus. I apologize if I am not expressing these doubts clearly here -
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by kcowan »

I think you have summed up my feelings really well.
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Re: Corus Entertainment Inc. (Symbol - CJR.B)

Post by shellybear »

Noted a huge selloff in Corus on friday, and the stock has slid from 14 $ range in Mid august to 11.60 on friday .
I think the streaming businesses, NETFLIX , AMAZON, APPLE TV etc are stealing some thunder from Corus, and their cable tv offerings. Add to that these ANdroid Tv boxes that show everything (one time buy and then no fees), albeit poorer quality and they are difficult to use.
Still i have talked to several folks of late who have axed their cable bill, and only have high speed internet, with streaming devices and Netflix.
SHAW made the right move selling off these tv programs to Corus, and concentrating on Internet and phone mobility infrastructure.
Would buy SHAW ahead of Corus, even tho Corus looks more oversold.
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