Cogeco Communications (CCA) — 52-week low after the SpaceX spectrum scare; ~7.5% yield at ~6x free cash flow

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Quick version: 60-second Short

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The short version: a cheap telecom caught in a U.S. scare

Cogeco Communications (TSX: CCA), the Montreal-based cable and internet company behind the Cogeco and oxio brands in Canada and Breezeline in the United States, hit a 52-week low on October 9, 2026. The stock fell 7.1% to C$48.70 as SpaceX’s purchase of U.S. wireless spectrum knocked telecom stocks lower on both sides of the border. It was already down 12.5% over the month to October 8 and 18% over the year. The new story is that Cogeco is a cheap, high-yield stock with a shrinking U.S. business and a lot of debt.

On the October 8 screener data, Cogeco pays an indicated dividend yield of about 7.5% and trades at about 6x free cash flow, the lowest in its peer group. The question for a new buyer is whether that is value or a trap: can cash flow keep covering the dividend while the U.S. side shrinks? Below we go through the selloff, the target cuts, and how Cogeco compares with Bell, Rogers, TELUS and Quebecor on size, returns, valuation, dividends and analyst targets.

What happened: the SpaceX spectrum deal and a telecom selloff

Late on October 8, 2026, SpaceX agreed to buy a nationwide block of U.S. low-band spectrum. The market reaction came the next day:

• SpaceX is buying Grain Management’s nationwide 800 MHz spectrum portfolio for about US$8B, to push its Starlink network into satellite-to-phone service. The deal still needs U.S. regulatory approval.
• On October 9, Verizon fell 8.75%, its worst day since 2002; T-Mobile fell 13.3% and AT&T 9.8%.
• The selloff spilled into Canada even though the deal doesn’t touch Canadian airwaves. The TSX communication services index fell 4.2%; Cogeco dropped 7.1% and Bell 5.5%.

The deal doesn’t change Cogeco’s cash flow this year. What it changes is sentiment: investors are now pricing a new, well-funded competitor into every telecom stock. Cogeco is more exposed to the U.S. than most Canadian telcos, because its Breezeline unit serves customers in 13 states. Two banks also cut their targets just before the drop: Desjardins from C$68 to C$64 (Hold) on October 7, and CIBC from C$71 to C$65 (Neutral) on October 8.

The Q3 print behind the weakness

Cogeco’s last results, released on July 15, 2026 for the quarter ended May 31, showed the split clearly:

• Revenue of C$696.7M, down 4.7% (down 3.6% in constant currency),
• Canada up 0.5% to C$376.7M, with a third straight quarter of higher adjusted EBITDA,
• U.S. (Breezeline) down 10.1% to C$320.0M (down 7.8% in constant currency) on subscriber losses and price competition,
• free cash flow of C$169M in the quarter and C$450M over nine months; fiscal 2026 guidance reconfirmed.

The weak spot is the U.S. In the same quarter Cogeco recorded a non-cash write-down of about C$1.7B after tax (US$1.2B) on Breezeline’s goodwill and intangible assets, which is why its reported results show a large loss. Management is leaning on wireless bundles and welo, a lower-cost digital brand now across its Ohio footprint, to steady the U.S. business.

Business overview: Cogeco vs Canadian telecom peers

Cogeco sells internet, video, home phone and, increasingly, wireless service to about 1.6 million residential and business customers. Canada (mostly Ontario and Quebec) is the steady part; the U.S. business is the part under pressure. The company is controlled by Cogeco Inc. (TSX: CGO), which held 28.4% of the equity and about 80% of the votes as of May 31.

The TSX screener files Cogeco under Consumer services, next to restaurants, media and gaming names, with no cable or telecom peers. So we use a documented closest-sector exception: the four large, liquid names from the Communications sector. Bell (BCE), Rogers (RCI.A), TELUS (T) and Quebecor (QBR.A) all sell internet and TV in Canada, and Rogers and Quebecor compete with Cogeco directly in Ontario and Quebec. Sub-C$1B names and the parent Cogeco Inc. were left out.

Overview table

Company (Ticker)	Price	Market cap	Revenue (LTM)	Net income (LTM)
Cogeco Comm. (CCA)	$52.50	$2.22B	$2.81B	−$1.11B
Bell (BCE)	$28.19	$26.3B	$24.8B	$6.42B
Rogers (RCI.A)	$44.86	$23.8B	$22.6B	$6.17B
TELUS (T)	$11.34	$18.0B	$20.2B	−$919M
Quebecor (QBR.A)	$64.69	$14.4B	$5.79B	$944M
Average (incl. CCA)	—	$16.9B	$15.2B	$2.30B

Source: TSX screener (October 8, 2026, tsx-2026-10-08.csv) · CAD · LTM = last 12 months. Average includes CCA; blank cells skipped.

Cogeco is by far the smallest name here, at about C$2.2B of market value against C$14B to C$26B for the others, on C$2.8B of yearly revenue. Its C$1.1B net loss over the last 12 months is almost all the U.S. write-down; underlying cash generation is still positive.

Performance: a sector-wide slide, worse for Cogeco

Performance table

Company (Ticker)	1M	3M	6M	1Y	5Y	10Y
Cogeco Comm. (CCA)	−12.5%	−17.5%	−16.7%	−18.4%	−53.4%	−17.9%
Bell (BCE)	−14.0%	−7.1%	−14.6%	−12.6%	−55.5%	−52.8%
Rogers (RCI.A)	−16.9%	−6.8%	−2.6%	−10.3%	−25.0%	−15.6%
TELUS (T)	−15.3%	−23.3%	−30.3%	−47.7%	−59.0%	−46.6%
Quebecor (QBR.A)	+4.3%	−6.5%	+17.6%	+42.2%	+110%	+231%
Average (incl. CCA)	−10.9%	−12.2%	−9.3%	−9.3%	−16.6%	+19.7%

Source: TSX screener (October 8, 2026). Average includes CCA; blank cells skipped. Price change by window.

Over the last year Cogeco fell 18%. Bell and Rogers lost 10% to 13%, TELUS lost almost half its value, and Quebecor gained 42%, the only clear winner. The last month hurt the whole group except Quebecor: Cogeco fell 12.5% to October 8, before Friday’s 7% drop added to it. Over five years Cogeco is down by more than half, in line with Bell and TELUS, so this is a long sector de-rating as much as a Cogeco-specific problem.

Valuation: the cheapest telecom on most measures

Valuation table

Company (Ticker)	P/E	Fwd P/E	PEG	P/S	P/B	P/FCF	Price/Cash
Cogeco Comm. (CCA)	—	6.12	—	0.78	1.19	5.92	28.53
Bell (BCE)	4.19	11.38	—	1.05	1.27	9.89	54.88
Rogers (RCI.A)	3.94	9.71	—	1.06	1.46	8.83	14.03
TELUS (T)	—	15.47	—	0.87	1.34	8.23	12.87
Quebecor (QBR.A)	15.84	14.18	0.70	2.59	5.28	9.50	120
Average (incl. CCA)	7.99	11.37	0.70	1.27	2.11	8.47	45.98

Source: TSX screener (October 8, 2026). Average includes CCA; blank cells skipped. Highlighted = lowest (cheapest) positive value per column.

Cogeco is the cheapest stock in the table on most columns. It trades at 0.78x sales, 1.2x book value and about 6x free cash flow, all the lowest of the group, against averages of 1.27x, 2.11x and 8.47x. There is no trailing P/E because of the write-down; on forward earnings it trades near 6x, against roughly 10x to 15x for the peers.

Bell and Rogers look even cheaper on trailing P/E, at about 4x, but those numbers are flattered by one-off gains in their net income, and their forward P/Es are 11.4x and 9.7x. A low multiple is not automatically a bargain: Cogeco is small, its revenue is shrinking and it carries net debt of about 3.1x EBITDA on screener figures. If the U.S. business stabilises, the free-cash-flow multiple looks too low; if it keeps shrinking, the market may be right.

Dividend: the highest yield, covered by free cash flow

Dividends table

Company (Ticker)	Dividend / share	Yield	Payout ratio
Cogeco Comm. (CCA)	$3.69	7.52%	—
Bell (BCE)	$2.31	6.21%	26.0%
Rogers (RCI.A)	$2.00	4.46%	17.5%
TELUS (T)	$1.65	6.61%	—
Quebecor (QBR.A)	$1.40	2.78%	36.1%
Average (incl. CCA)	$2.21	5.52%	26.5%

Source: TSX screener (October 8, 2026). Average includes CCA; blank cells skipped. Yield = indicated.

Cogeco pays C$0.987 a quarter, about C$3.95 a year at the current rate (the table shows the last fiscal year’s C$3.69). That is an indicated yield of 7.52% at the screener price and closer to 8% after Friday’s drop, against a group average of about 5.5%. The screener payout ratio is blank because of the net loss, so a better test is cash: dividends of about C$167M a year use a bit under half of the last year’s C$373M of free cash flow, leaving the rest for debt repayment. TELUS cut its dividend this year, so we show its indicated yield; its trailing 12.9% is stale. The yield is the attraction, but it is only as safe as the cash flow behind it.

Analyst view: 40%+ upside on paper, but the moves are cuts

Analyst table

Company (Ticker)	Rating	Price	Target 1Y	Upside	Analysts
Cogeco Comm. (CCA)	Buy	$52.50	$69.36	+32.1%	11
Bell (BCE)	Buy	$28.19	$37.17	+31.9%	19
Rogers (RCI.A)	Buy	$44.86	$59.14	+31.8%	18
TELUS (T)	Neutral	$11.34	$14.11	+24.4%	18
Quebecor (QBR.A)	Buy	$64.69	$70.12	+8.4%	13
Average (incl. CCA)	—	—	—	+25.7%	—

Rating & price: TSX screener (October 8, 2026). Target 1Y: S&P Global consensus via stockanalysis.com, pulled 2026-10-11 — CCA C$69.36 (11 analysts, includes CIBC Oct 8 and Desjardins Oct 7 cuts), BCE C$37.17 (19), RCI.B C$59.14 (18; class B used for RCI.A), T C$14.11 (18); MarketBeat for QBR.B C$70.12 (13; class B used for QBR.A). None under 5 analysts. Upside = target ÷ price − 1.

The screener rates Cogeco a Buy, and the S&P Global consensus target is C$69.36 from 11 analysts, about 42% above the October 9 close of C$48.70 (32% above the screener price). But 6 of the 11 rate it a hold, and the latest moves were cuts: Desjardins to C$64 (Hold, October 7) and CIBC to C$65 (Neutral, October 8). TD Cowen is the most bullish at C$83 with a Buy (August 25); RBC and National Bank sit at C$70 with sector-perform ratings. Peers show similar 24% to 32% upside except Quebecor, so the Street sees the whole group as oversold rather than Cogeco alone.

Why it matters: from steady dividend grower to cheap turnaround

The old story was a steady cable company with a growing dividend: Cogeco has raised its dividend for 20 straight years, by about 7% to 10% a year recently. The new story is a cheap stock with a shrinking U.S. business and a lot of debt, where the write-down has already admitted Breezeline is worth less than Cogeco paid.

The SpaceX deal adds a new worry on top: satellite and wireless competition for broadband customers. For income investors the yield is the attraction. The open question is whether free cash flow can keep covering it while the U.S. side shrinks.

Bull case

1. Priced for decline. About 6x free cash flow leaves room for the stock to re-rate if the U.S. business simply stabilises.
2. Canada is steady. Canadian revenue and adjusted EBITDA are growing, and wireless is adding customers and cutting churn.
3. A covered dividend. Dividends use a bit under half of free cash flow, with more than half left for debt repayment.

Bear case and risks

1. Breezeline keeps shrinking. U.S. revenue fell 10% last quarter, and more write-downs are possible if competition stays this intense.
2. Debt. Net debt of about 3.1x EBITDA limits flexibility if cash flow slips.
3. New competition. Satellite and fixed wireless could keep pushing broadband prices down, on both sides of the border.

What to watch

1. Fourth-quarter fiscal 2026 results on October 28, 2026, after the close, with the call on October 29.
2. Fiscal 2027 guidance, especially for free cash flow.
3. Breezeline subscriber trends and the rollout of the welo digital brand in Ohio.
4. The dividend growth policy — any change to the pace of increases.

Bottom line

Cogeco has a steady Canadian business and still generates real free cash flow, enough to cover a yield of about 7.5% with room left over. The issue is the U.S., where Breezeline is shrinking, and a C$1.7B write-down has already reset its value. At about 6x free cash flow the market is pricing in more decline, and the SpaceX deal added a new worry. The next test is the October 28 results and whether fiscal 2027 guidance shows free cash flow holding up.

Video chapters

• 0:00 Hook — 52-week low after the SpaceX scare
• 0:25 SpaceX spectrum deal & the telecom selloff
• 0:43 U.S. exposure, write-down & target cuts
• 1:11 Overview — Canadian telecom peers
• 1:32 Performance heatmap
• 1:48 Valuation (~6x free cash flow)
• 2:15 Dividends (~7.5% yield)
• 2:40 Analyst ratings & target cuts
• 3:02 Why it matters
• 3:17 Bull case
• 3:37 Bear case
• 3:54 What to watch

Data notes

Table figures are TSX screener values (merge tsx-2026-10-08.csv, 3,581 rows; prices from before the October 9 selloff; CAD). Cogeco closed at C$48.70 on October 9 (−7.1%), which is not yet in the tables. The screener files Cogeco under Consumer services, so peers are the four large Communications names (Bell, Rogers, TELUS, Quebecor; the screener carries the class A shares of Rogers and Quebecor); sub-C$1B names and parent Cogeco Inc. were skipped. Average rows include CCA and skip blank cells; payout is blank for CCA and TELUS because of net losses. Target 1Y is the S&P Global consensus via stockanalysis.com pulled October 11, 2026 (CCA 11, BCE 19, RCI.B 18, T 18 analysts) and MarketBeat for QBR.B (13); none under 5. The dividend-to-free-cash-flow ratio and net debt to EBITDA are derived from screener figures. Quarter figures are from Cogeco’s July 15, 2026 release.

Sources

• Cogeco Communications news release, July 15, 2026 — Cogeco Communications announces its Q3 2026 financial results
• Cogeco news release, June 1, 2026 — non-cash impairment charge related to the American telecommunications segment
• Cogeco news release, September 23, 2026 — Q4 fiscal 2026 results date (October 28) and conference call
• CNBC and Reuters — telecom stocks sell off on SpaceX spectrum deal, October 9, 2026
• The Globe and Mail / Investing.com — TSX close and biggest decliners, October 9, 2026
• MarketBeat — Desjardins (October 7) and CIBC (October 8) target cuts on CCA
• stockanalysis.com (S&P Global) and MarketBeat — consensus targets, pulled October 11, 2026
• TSX screener merge October 8, 2026 (3,581 rows)

Media credits

Wikimedia Commons: Cogeco logo (File:Cogeco logo.svg, public domain; trademark of Cogeco Inc.); “Starlink Satellites Overhead” by M. Lewinsky (CC BY 4.0); “CogecoOpticalFiber” by Raysonho @ Open Grid Scheduler / Grid Engine (CC0); “‘09-‘12 Ford Escape Cogeco” by Bull-Doser (public domain); “Fibre-optic cable in a Telstra pit” by Bidgee (CC BY-SA 2.5 AU). No AI-generated images were used.

By Andrew · stocksummarizer.com