Rogers

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Rogers

  1. 1. ROGERSCASE ANALYSIS <br />Group 1<br />March 24, 2010<br />FINANCIAL MARKET OUTLOOK<br />
  2. 2. CANADIAN GDP<br />Increases in GDP growth rate supported by <br /><ul><li>Government spending
  3. 3. Capital investment and trade
  4. 4. Consumer spending,
  5. 5. Winter Olympics </li></ul>What does this mean for Rogers?<br /><ul><li>Increasing consumer spending will allow Rogers to increase average revenues per user</li></li></ul><li> INFLATION IN CANADA<br />This quarter:<br /><ul><li>Analyst estimate: 1.7%
  6. 6. Actual inflation: 2.1%</li></ul>Consumer prices have risen 1.6% in 12 months to February<br /><ul><li>Higher gasoline prices
  7. 7. Higher prices for passenger vehicles
  8. 8. housing rose 6.5 percent.</li></ul>What does this mean for Rogers?<br /><ul><li> People spent 3.0% more for cablevision and satellite services</li></li></ul><li> UNEMPLOYMENT DATA<br />Canada gained 87, 700 jobs in past 12 months<br />But, they lost 250, 000 job in 2008<br /><ul><li>Slow recovery expected</li></ul>What does this mean for Rogers?<br /><ul><li>In spite of slow job recovery, consumer spending in on the rise. </li></li></ul><li> INTEREST RATES<br />BoC under pressure to increase interest rates due to higher than expected Inflation growth in February<br />Benefits of low interest rates are being offset by a high CDN dollar.<br />What does this mean for Rogers?<br /><ul><li>Principal due in upcoming years</li></li></ul><li> EXCHANGE RATES<br />Exports are shrinking as the Canadian Dollar continues in strength<br /><ul><li> Bad news for manufacturers</li></ul>Companies tied to consumers are more optimistic<br /><ul><li>Earnings are in CDN dollars</li></ul>What does this mean for Rogers? <br /><ul><li>A strong dollar will help them with debt repayment since majority of debt is in USD</li></ul>2007<br />2008<br />2009<br />2010<br />
  9. 9. INDUSTRY OUTLOOK <br />CONSUMER HABITS<br />DEREGULATION<br />COMPETITION<br />Threat of increased competition <br />Wireless and Cable Segments<br />Demand for better services<br />4G Networks<br />Demand for mobile access to internet<br />Smart phones<br />Lower ad revenues in the Cable segment<br />Higher demand for PVR devices<br />Market saturation<br /><ul><li>Stagnant subscriber base in wireless mobile
  10. 10. Increased demand for better service</li></ul>New Entrants<br /><ul><li>Price wars</li></li></ul><li>Real GDP & USD$/CAD$<br />
  11. 11. Inflation (Core) & Unemployment Rate<br />
  12. 12. Overnight Rate & 10 Yr Bond Rate<br />
  13. 13. Sources:<br />and Source OECD and Policy & Economic Analysis at University of Toronto <br />
  14. 14. Thank You<br />
  15. 15. Real GDP & USD$/CAD$<br />
  16. 16. Inflation (Core) & Unemployment Rate<br />
  17. 17. Overnight Rate & 10 Yr Bond Rate<br />

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