Financial Analysis: Rogers Communications Inc. Class B (RCI) vs. Liberty Broadband Corp Series A (LBRDA)

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Rogers Communications Inc. Class B (NASDAQ: LBRDA) and Liberty Broadband Corp Series A (NASDAQ:LBRDA) are both large-cap consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, institutional ownership, earnings, profitability and risk.

Earnings and Valuation

This table compares Rogers Communications Inc. Class B and Liberty Broadband Corp Series A’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rogers Communications Inc. Class B $10.91 billion 2.51 $1.32 billion $2.71 19.59
Liberty Broadband Corp Series A $13.09 million 1,114.01 $2.03 billion $11.10 7.24

Liberty Broadband Corp Series A has lower revenue, but higher earnings than Rogers Communications Inc. Class B. Liberty Broadband Corp Series A is trading at a lower price-to-earnings ratio than Rogers Communications Inc. Class B, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

47.6% of Rogers Communications Inc. Class B shares are held by institutional investors. Comparatively, 12.0% of Liberty Broadband Corp Series A shares are held by institutional investors. 5.7% of Liberty Broadband Corp Series A shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Rogers Communications Inc. Class B has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, Liberty Broadband Corp Series A has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500.

Profitability

This table compares Rogers Communications Inc. Class B and Liberty Broadband Corp Series A’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rogers Communications Inc. Class B 12.66% 29.52% 6.87%
Liberty Broadband Corp Series A 9,285.42% 20.47% 18.04%

Analyst Ratings

This is a breakdown of current ratings and price targets for Rogers Communications Inc. Class B and Liberty Broadband Corp Series A, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rogers Communications Inc. Class B 0 3 2 0 2.40
Liberty Broadband Corp Series A 0 0 4 0 3.00

Rogers Communications Inc. Class B presently has a consensus price target of $62.00, suggesting a potential upside of 16.78%. Liberty Broadband Corp Series A has a consensus price target of $112.25, suggesting a potential upside of 39.60%. Given Liberty Broadband Corp Series A’s stronger consensus rating and higher possible upside, analysts clearly believe Liberty Broadband Corp Series A is more favorable than Rogers Communications Inc. Class B.

Dividends

Rogers Communications Inc. Class B pays an annual dividend of $1.48 per share and has a dividend yield of 2.8%. Liberty Broadband Corp Series A does not pay a dividend. Rogers Communications Inc. Class B pays out 54.6% of its earnings in the form of a dividend.

Summary

Liberty Broadband Corp Series A beats Rogers Communications Inc. Class B on 11 of the 16 factors compared between the two stocks.

About Rogers Communications Inc. Class B

Rogers Communications Inc. operates as a communications and media company in Canada. The company's Wireless segment offers wireless telecommunications services to consumers and businesses under the Rogers, Fido, and chatr brands; and wireless devices, services, and applications. This segment distributes its products through independent dealer networks, company-owned retail stores, retail chains and convenience stores, e-commerce sites, call centers and outbound telemarketing, and other distribution channels. As of December 31, 2017, it had approximately 10.5 million subscribers. The company's Cable segment provides high-speed broadband Internet access, digital television and online viewing, phone, and home Wi-Fi services to consumers, businesses, and enterprises; and monitoring, security, automation, energy efficiency, and smart control services. This segment also offers network connectivity services through its fiber network and data center assets through its sales team, third-party retailers, and a network of third-party channel distributors to the enterprise, public sector, and carrier wholesale markets. It distributes its products through company-owned retail stores, e-commerce sites, call centers, outbound telemarketing, door-to-door agents, and other retail locations. This segment had approximately 2.2 million high-speed Internet subscribers, 1.7 million television subscribers, and 1.1 million phone subscribers, as well as operated a network that passes 4.3 million homes. Its Media segment offers multi-platform televised and online shopping, digital media services, and publishing services; and operates television networks and radio stations, as well as owns the Toronto Blue Jays, a league baseball team and Rogers Centre event venue. The company also provides credit cards. Rogers Communications Inc. was founded in 1920 and is headquartered in Toronto, Canada.

About Liberty Broadband Corp Series A

Liberty Broadband Corporation, a cable operator, provides video, Internet, and voice services to residential and commercial customers in the United States. It operates through Skyhook and Charter segments. The Skyhook segment offers Precision Location Solution, a location determination service for mobile device makers, wireless carriers, and asset tracking platforms to understanding the precise geographic location and movement of mobile devices; enhancing the location determination capabilities of a hybrid location system. It also provides Geospatial Insights, a location intelligence and data insights service for enterprises, research and consulting firms, financial institutions, and advertisers to understand, measure, and optimize the performance of businesses; benchmark performance against competitors; enhance customer experience; advertise to, and target existing and prospective customers; and measure the efficacy of advertising campaigns in driving real-world actions. The Charter segment offers subscription-based video services comprising video on demand, high definition television, and digital video recorder service; and local and long distance calling, voicemail, call waiting, caller ID, call forwarding, and other voice services, as well as international calling services. It also provides Internet services, which comprises an in-home Wi-Fi product that provides customers with high performance wireless routers; out-of-home Wi-Fi service for Internet customers at designated hot spots; and a security suite that offers protection against computer viruses and spyware. In addition, this segment offers Internet access, data networking, video entertainment, and business telephone services; fiber connectivity to cellular towers and office buildings; and advertising services on cable television networks and digital outlets, as well as regional sports and news networks distribution, and security and home management services. The company is based in Englewood, Colorado.

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