Shaw SJR

[Viking]

I have initiated a small position in Shaw (SJR-NYSE / SJR.B-TSE).

 

The shares are trading (CAN $ details) at just over $20.00

- current dividend is $0.88/yr = 4.4% (payout ratio = 67%)

- F2009 earnings = $1.19; P/E = 16.8

- F2010 earnings forecast = $1.45; P/E = 13.8

 

Shares have sold off recently due to Shaw's likely start up of wireless business at end of 2010 and the uncertainly around how much they will chose to spend.

 

Reading through the quarterly report etc and it certainly appears that Shaw is a well run business. Management also looks to be very shareholder friendly with earnings (high dividend yield and share repurchases). similar to FFH, the shaw family has clear voting control. Their current businesses are performing exceptionally well and they have a very good historical return on equity. I believe Shaw management is calling for earnings to grow by 11% this year. Their main competitor out West is Telus; my personal experience is Telus' customer service is a train wreck. In cable/internet, Shaw also appears to have the much better technology.

 

Bottom line, this stock looks to be a solid bet to deliver me 8 to 10% per year (between dividend and price appreciation). As I have said before I am looking to find a basket of these types of opportunities to hold in place of a portfolio of bonds...

 

Anyone else have an opinion on Shaw?

 

 

[Packer16]

Shaw sounds like an interesting story but the price is too high for me @ 7.5x EBITDA when you can buy TWC @ 6.0x EBITDA, SURW @ 4.5x EBITDA and MCCC @ 3.8x FCF.

 

Packer

[Uccmal]

Viking, in the same line of thinking:  MFC, GE - are both still pretty cheap (I hold both, GE through options right now).  Sun Life is also cheap.  SLf and MFC have been beaten down by their Equity based annuities business.  MFC has been building cash for 1.5 years almost and will certainly start raising the dividend again. 

 

PWF which I also hold is a good bet, but it is much more expensive than the price I bought at:  Its subs may be cheaper on a relative basis (especially GWO).  - you can always count on the Desmarais family to keep raising dividends and keep a lid on risk taking.

[ubuy2wron]

Telus customer service is a train wreck.?  Try getting Shaw service re internet it typically takes 30 minutes to speak to a person if you call the service line at Shaw. Shaw and Telus should merge and stop beating each other up. Telus is trying to poach Shaws internet  and cable business and Shaw is trying to poach land line business from Telus neither co is profiting form this from my perspective. It is unlikely they would ever be allowed to merge but it seems that perhaps conditions have changed enough because of new tech and competitors a merger may be allowed.

[ericd1]

Viking, in the same line of thinking:  MFC, GE - are both still pretty cheap (I hold both, GE through options right now). 

 

Uccmal,

 

I don't do much with options, but I'm with you on GE. I bought some in-the-money Jan '11's leaps last March and some '12's last month. The '11's have worked out very well and I can't complain about the '12's. I've been looking for similar opportunities!