# Corus Entertainment Inc. (CJR.B)



## gmx (Apr 1, 2013)

First time investor (started in spring of this year). Have been watching CJR.B for awhile and after its last report, price has started to drop. With cable subscripts and radio ads on the decline and internet content, is this is a good investment? Does anyone else hold Corus?


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## doctrine (Sep 30, 2011)

Not sure it's fairly priced for a company with declining revenues and declining adjusted profit. It's only about 10% off its all time high. A P/E of 12 is good, but if they keep losing revenue eventually it will become a lot cheaper.


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## HaroldCrump (Jun 10, 2009)

The stock is essentially a dog.
Other than a 4.3% dividend, there is nothing in there.

The only hope for an upside is an acquisition by a large Telco or multimedia provider like BCE's acquisition of Astral Media (subject to Competition Bureau approval, of course).
A while ago there were some rumors about a possible bid by Rogers, but it hasn't materialized.
Going long on this is essentially a bet on an acquisition.


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## gmx (Apr 1, 2013)

Good points. I'm leaving it alone. Thanks for the feedback.


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## My Own Advisor (Sep 24, 2012)

I'm with HaroldCrump. I own only a few shares...waiting for a buyout.


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## Flash (Nov 25, 2014)

Thoughts on the big drop due to the CRTC ruling? Was thinking of buying some more. Profits look average in the past years with no increase or decrease, but not sure what to think when 44% of their revenue is from TV


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## fatcat (Nov 11, 2009)

Flash said:


> Thoughts on the big drop due to the CRTC ruling? Was thinking of buying some more. Profits look average in the past years with no increase or decrease, but not sure what to think when 44% of their revenue is from TV


i have been avoiding them for this very reason ... i think we have a lot more disruption to go in the media delivery / creation / distribution space

nice divvy as i recall but i just don't like the category ... used to own them


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## Strength (Jul 12, 2015)

Anyone still own this stock or have any opinion on it?

I purchased this stock awhile back at $20.70 a share. I gotta say I'm extremely disappointed in the company and it's fundamentals. I'm down about 27%, but still holding onto it for obvious reasons hoping one day it'll bounce back.


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## HaroldCrump (Jun 10, 2009)

I haven't changed my opinion from post # 3 above, dated 2013-10-28 :biggrin:

Can't say what the future holds, but all fundamental factors points against any significant recovery back to the $25+ days.
Best case scenario for long-term sufferers is an acquisition by one of the integrated telcos, such as Rogers or Telus, for a 15% - 20% premium to bottom valuation.
Assuming CRTC approves, of course.
Given how the Bell acquisition of Astral was handled by CRTC, this one won't be smooth either.


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## treva84 (Dec 9, 2014)

So anyone buying Corus as of late? I purchased some today at 9.32. This is the lowest it's ever been in 13 years! I must admit I'm a bit nervous about this buy; on the one hand it has an exceptional valuation and should be relatively stable compared to other companies with current exceptional valuations (i.e. POT). On the other hand they have a high pay out ratio and any further deterioration would lead to a dividend cut. 

I think the Shaw deal is good for the future, assuming it goes through. What do you guys think?


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## Just a Guy (Mar 27, 2012)

Heard something about Shaw doing some weird bookkeeping by selling assets to corus so that they could do their other purchase. Since Shaw owns corus, it was basically a paper shuffle to make the books look better...but, from what was implied, Shaw could really afford the purchase, and corus doesn't benefit from the acquisition, since it can't really afford it either.

Sounds like the type of bookkeeping which brings down companies.


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## AltaRed (Jun 8, 2009)

The issue with Corus is not so much the Shaw deal. The Shaw deal was about putting content all together in one entity so that it could compete as a larger entity when Pick and Pay takes effect. 

The bigger issue in my view is when Pick and Pay takes effect, which content are subscribers willing to pay for and what will die on the vine. There will be a lot of turmoil as this transition takes place and hence significant uncertainty in whether Corus will be a net winner or loser.


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## besmartrich (Jan 11, 2015)

treva84 said:


> So anyone buying Corus as of late? I purchased some today at 9.32. This is the lowest it's ever been in 13 years! I must admit I'm a bit nervous about this buy; on the one hand it has an exceptional valuation and should be relatively stable compared to other companies with current exceptional valuations (i.e. POT). On the other hand they have a high pay out ratio and any further deterioration would lead to a dividend cut.
> 
> I think the Shaw deal is good for the future, assuming it goes through. What do you guys think?


Yup. I doubled down at $9.32 as well. It is scary for me as well but the cash flow was too good to say no. Hopefully the pick and pay transition goes smoothly so that I can make some good money out of it. Love the dividend and their commitment to increasing it year after year.


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## treva84 (Dec 9, 2014)

So this stock has been surging lately - up 14% since I purchased it - anyone have any ideas why? Related to new developments with the Shaw Deal?


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## 1sImage (Jan 2, 2013)

treva84 said:


> So this stock has been surging lately - up 14% since I purchased it - anyone have any ideas why? Related to new developments with the Shaw Deal?


No idea, the company was dowgraded today as well.


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## kcowan (Jul 1, 2010)

Another $50 million for the Shaw family

This is no doubt causing some of the activity from The Street.

As a Shaw Direct client, I am being screwed over by Pick and Pay. It is a revenue protection scheme.


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## gardner (Feb 13, 2014)

I've held a bit of Corus since Feb 2014 and I bought it originally because it was a dividend star. But the price has been on a steady decline since Oct 2015 and I see the analysts are pretty negative. Are other holding this? Any positive sentiment on it? I feel like I should just take the loss and move on.

I've got quite a large slog of SJR.B and it's been holding steady. Is that enough exposure to the Shaw's family business?


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## doctrine (Sep 30, 2011)

Corus' future is tied to the advertising revenue that it gets from television and radio. This is a dying business that will only accelerate - they have no realistic means to recoup this revenue. The Shaw acquisition is going to buy a little time while they cut costs, but the tide is inevitably going out. There should be no dividend on this company based on the wider risks they face, they should be eliminating their debt and investing for growth or heavily in lowering costs where they can.


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## fatcat (Nov 11, 2009)

doctrine said:


> Corus' future is tied to the advertising revenue that it gets from television and radio. This is a dying business that will only accelerate - they have no realistic means to recoup this revenue. The Shaw acquisition is going to buy a little time while they cut costs, but the tide is inevitably going out. There should be no dividend on this company based on the wider risks they face, they should be eliminating their debt and investing for growth or heavily in lowering costs where they can.


agree ... dinosaur ... dumped mine a long time ago


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## Eder (Feb 16, 2011)

I think Corus is Yellow Pages rebooted. ( and maybe it's just me but why do we want exposure to the Shaw family?)


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## AltaRed (Jun 8, 2009)

Eder said:


> I think Corus is Yellow Pages rebooted. ( and maybe it's just me but why do we want exposure to the Shaw family?)


Corus may have more going for it than Yellow Pages, i.e. all those Canadian productions paid for by Cdn broadcasters/cable.....but I agree, why feed the greedy Shaw family, i.e. Jim and Brad? They pull monstrous money out of the business, way more than the business warrants. I would never own them out of principle!!!!


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## megavolt (Jan 9, 2018)

So, Corus is yeliding 10% now, any ideas if it's a good buy?


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## spdr1812 (Apr 8, 2016)

I tried to be a believer , got in a while ago thank god because now trying to get out at a reasonable price .. would avoid . The Div has been nice but it's gotta get cut eventually .


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## doctrine (Sep 30, 2011)

megavolt said:


> So, Corus is yeliding 10% now, any ideas if it's a good buy?


The same thing I said in October applies. "Dying" may be overstated- radio has been "dying" for decades, but it is *definitely* an industry in long term revenue decline. They need money to reinvest in the business if they will survive. Paying everything out gives current shareholders cash, but will bankrupt the company in future years. They will wish they had the $200-250M/year in dividends in a few years. 

_Corus' future is tied to the advertising revenue that it gets from television and radio. This is a dying business that will only accelerate - they have no realistic means to recoup this revenue. The Shaw acquisition is going to buy a little time while they cut costs, but the tide is inevitably going out. There should be no dividend on this company based on the wider risks they face, they should be eliminating their debt and investing for growth or heavily in lowering costs where they can._


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## megavolt (Jan 9, 2018)

Thanks for your thoughts guys!
Looking at there report now, and they are still loosing money.


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## kac147 (Jan 12, 2018)

I wouldn't suggest to buy Corus at this moment. Their EPS has been dropping in the last two years. From the growth analysis it is not a good pick. Also, they promised to pay that high amount of dividend even if the profit drops. This is not a good move for not retaining its income for operations and generating more returns for investors. 

However, from the value analysis, their P/B and P/E are so low that you may make good returns when their profits increase in the future. But it will be a very long term investment and no one would know when the price will get higher (you might have to hold it for more than 7 years). 

I would hold off and observer for another two quarters results before making a decision.


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## spdr1812 (Apr 8, 2016)

I think they will cut the Div soon , have too ?


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## kac147 (Jan 12, 2018)

They have declared dividends for the next few months until April. If they cut dividend after, I would think the share price will drop even more unless they have better profits on the next quarter.


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## fatcat (Nov 11, 2009)

i don't care how sterling their numbers are or might be, they are selling a product that increasingly people do not want to buy ...


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## AltaRed (Jun 8, 2009)

fatcat said:


> i don't care how sterling their numbers are or might be, they are selling a product that increasingly people do not want to buy ...


+1. Shaw wasn't stupid when it spun off its media assets into this and monetized a good part of it. This thing will slowly deteriorate by the death of a thousand cuts but will survive simply because some of its TV channels, kid's stuff for example, Disney channels, HGTV, have staying power backed by their US 'parents' and Canadian content requirements. http://www.corusent.com/about/our-brands/television/

I see a slow year-to-year grind down with its financials.


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## fatcat (Nov 11, 2009)

AltaRed said:


> +1. Shaw wasn't stupid when it spun off its media assets into this and monetized a good part of it. This thing will slowly deteriorate by the death of a thousand cuts but will survive simply because some of its TV channels, kid's stuff for example, Disney channels, HGTV, have staying power backed by their US 'parents' and Canadian content requirements. http://www.corusent.com/about/our-brands/television/
> 
> I see a slow year-to-year grind down with its financials.


right, i don't see disney removing their product from regular television but even disney (of which i am a happy stockholder) sees the handwriting on the wall on this one


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## milhouse (Nov 16, 2016)

FWIW, John Heinzl has an article in the G&M today outlining the red flags around Corus' double digit yield and the challenges the business faces.


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## My Own Advisor (Sep 24, 2012)

I used to own CJR.B years ago but the yield keep going up and the stock price went the other way. Sold and gone for good on this one.


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## milhouse (Nov 16, 2016)

Corus was referenced in Saturday's G&M by John Heinzl's Stars and Dogs and listed as a star due to outperformance in their Q2 results with their share price rising over 20% for the week. However, he also referenced Corus indicating that they are going to review their 15% dividend yield with details coming during their Q3 results report in June. A National Bank analyst, Adam Shine, is expecting a material cut to their dividend.


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## spdr1812 (Apr 8, 2016)

Limit set at $7.15 night before earnings and i am outta there .


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## Just a Guy (Mar 27, 2012)

Always love the talking heads "stock rose 20% last week" get in...ignoring the fact that the stock price has dropped nearly 50% over the last few months.


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## milhouse (Nov 16, 2016)

Point of clarification. I'm not sure I'd consider noting Corus a star as recommendation to buy it but rather just an identification of it being one of the big movers for the week in the positive direction.


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## milhouse (Nov 16, 2016)

And here comes the dividend cut. From 9.5cents per month to 6cents per quarter. 
The underlying business is trending pretty badly.


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## doctrine (Sep 30, 2011)

milhouse said:


> And here comes the dividend cut. From 9.5cents per month to 6cents per quarter.
> The underlying business is trending pretty badly.


If you read back in this thread, it has been a confirmed trend here since 2013. Not news. Not sure what investors were expecting. The value difference on a company with 5% revenue growth versus 5% revenue decline is quite dramatic, very well modeled, and absolutely confirmed in this case. There is yet no evidence that this company is not going to zero. They just wrote off more than $4 a share in a single quarter on a stock that is trading at $5.


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## gardner (Feb 13, 2014)

I anticipate taking the loss later on this year and getting out. I never had very much, so not a huge hit, but it has been a dog as long as I've owned it. I should have dumped it when they did that asset swap with Shaw to suck all the goodness out of CJR. I am amply exposed to Shaw family shenanigans via SJR and won't miss CJR.


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## milhouse (Nov 16, 2016)

doctrine said:


> If you read back in this thread, it has been a confirmed trend here since 2013. Not news. Not sure what investors were expecting. The value difference on a company with 5% revenue growth versus 5% revenue decline is quite dramatic, very well modeled, and absolutely confirmed in this case. There is yet no evidence that this company is going to zero. They just wrote off more than $4 a share in a single quarter on a stock that is trading at $5.


I guess the hope was for some signs of life to see if it's worth picking up as a bargain versus catching a falling knife. 



gardner said:


> I anticipate taking the loss later on this year and getting out. I never had very much, so not a huge hit, but it has been a dog as long as I've owned it. I should have dumped it when they did that asset swap with Shaw to suck all the goodness out of CJR. I am amply exposed to Shaw family shenanigans via SJR and won't miss CJR.


I feel for you as I'm sure many of us have had similar regrets of having should have dumped a dog before it really took a hit. I know I have.


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