Cogeco: Investors Undervaluing Portuguese Business - UBS

Cogeco Cable Inc. (CGEAF.PK) investors may want to consider the prospect that Cogeco unloads Cabovisao, its Portuguese cable asset, says UBS analyst Jeffrey Fan.

"At the current share price, we believe the market has attributed little or no value to Cabovisao," Mr. Fan said in a note to clients. "While the competition is intense and there is no evidence of management’s willingness to part, we believe this view is too pessimistic."

Mr. Fan said Cabovisao should consider opportunities to benefit from market consolidation because solid results from its competitors, Portugal Telecom and Zon, continue to suggest the company faces tough subscriber trends going forward.

The analyst reiterated his "buy" rating on Cogeco shares and C$44 price target.