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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: You thoughts on the asset sale to Bell would be appreciated, in particular how this may change free cash flow (and dividend protection) going forward and is this not also setting up the value of the company in the event of a buy-out?

The sale price for Movie Central, Encore and HBO Canada was $211 million. They state that this was derived by taking adjusted 2015 segment EBITDA multiple for Pay TV of 6.7x.

Fiscal 2015 Corus had $260 million of TV segment profit.

Even ignoring the value of the radio stations (let's say that they wash out against 'Corporate' and other costs in the event of a break-up or buy-out), wouldn't this put the value (based on what Bell paid for the above) of the remaining TV component at $1,530 million ($260 million x 6.7 - $211 million), or above $17.50/share? Or am I taking a too simplified view of the break-up value of the assets?
Read Answer Asked by Colin on November 23, 2015
Q: Hello everyone. This has been a painful investment for me. I believe in the turnaround in this name so I have increased my position. One has to look back to DEC 2008 to find the stock price down at these levels. Yes things are different but when I add up the some of the parts if someone was to strip it down and sell off it seems to be at a discount. Could I have your view on what you see the dollar per share for the some of the parts/cash and also the dividend going forward. Thank you again for your assessment. Jay
Read Answer Asked by JASON on October 22, 2015
Q: I have watched this stock plummet over the last few months and would like to know if you see value here? I have heard a overhaul is being looked at across all operations. Do you know the current cash position and if they can continue to pay the dividend? It looks to be heading toward the 2009 $11.00 -$12.50 area. Do you see deep value here. Thank you for your thoughts. Jason N.
Read Answer Asked by JASON on July 30, 2015
Q: I have a full position on Corus and while it's the type of company I generally hold (high and steady income), I'm weary now that there doesn't seem any end in sight after the Q2 loss and the negative regulatory ruling on unbundling.

I know there is still time (end of 2016) before the unbundling rule takes effect and it's not the end of the world for Corus, but how safe is the dividend? If it is safe, should I adding to my position now because these the stock is now undervalued?
Read Answer Asked by Eugene on April 15, 2015
Q: Keeping in mind the often-heard advice to sell your losers, what is a good way to define a loser; is it just being underwater on your position, or are industry and macro developments important considerations as well? The reason I ask is that I am currently under water on Corus, but I'm not sure if that alone makes it a loser given it's position and relative strength in the industry. However, when considering the challenges that the broadcasting industry will continue to face going forward, maybe I should categorize it as a loser and move on. How would you approach a decision like this? Thanks for any insight you can provide.
Read Answer Asked by Alan on March 23, 2015
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