Earnings Miss: Rogers Communications Inc. Missed EPS By 24% And Analysts Are Revising Their Forecasts

Last week, you might have seen that Rogers Communications Inc. (TSE:RCI.B) released its first-quarter result to the market. The early response was not positive, with shares down 2.4% to CA$34.98 in the past week. It looks like a pretty bad result, all things considered. Although revenues of CA$5.0b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 24% to hit CA$0.50 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Rogers Communications after the latest results.

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Following last week's earnings report, Rogers Communications' 15 analysts are forecasting 2025 revenues to be CA$20.8b, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 8.5% to CA$3.54. Yet prior to the latest earnings, the analysts had been anticipated revenues of CA$20.9b and earnings per share (EPS) of CA$3.95 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

Check out our latest analysis for Rogers Communications

It might be a surprise to learn that the consensus price target was broadly unchanged at CA$52.09, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Rogers Communications, with the most bullish analyst valuing it at CA$69.00 and the most bearish at CA$35.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Rogers Communications' revenue growth is expected to slow, with the forecast 1.1% annualised growth rate until the end of 2025 being well below the historical 9.3% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 4.3% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Rogers Communications.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Rogers Communications' revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Rogers Communications going out to 2027, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 1 warning sign for Rogers Communications that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.