Wireless communications and cable TV companies face challenges as consumers demand access to entertainment and information in new ways. Nevertheless, these two companies continue to provide dividend opportunities for investors.
Rogers Communications
This week, Rogers Communications (TSX: RCI.B) (NYSE: RCI) and Vodafone (NASDAQ: VOD) announced a new partner market agreement, with Rogers becoming Vodafone’s exclusive partner in Canada. The two companies will explore new business opportunities together and offer customers an array of products and services. Vodafone offers a suite of services, including voice, messaging, data, and fixed communications.
Rogers is focusing on continuing the growth in its smartphone subscriber base to drive wireless data revenue. Regarding its wireless operations for Q1 2014, its wireless data revenue increased 10%. This exceeded voice revenue for the first time. Wireless data revenue now represents roughly 51% of the company’s total network revenue. Rogers is Canada’s largest wireless provider.
In 2013, the company increased its annualized dividend per share 10%, from $1.58 to $1.74. Rogers Communications increased its dividend by 5% to $1.83 per share effective April 4, 2014. This will be paid out in quarterly amounts of $0.4575 per share. Its current dividend yield is 4.1% and its five-year average dividend yield is 3.7%.
Shaw Communications
A diversified communications and media company, Shaw Communications (TSX: SJR.B)(NYSE: SJR) serves 3.2 million customers. Its Shaw Media division operates one of the largest conventional television networks in Canada, Global Television, and 19 specialty networks. Shaw earned $5.1 billion in revenue in 2013.
Shaw is focusing on fast and reliable broadband connections for mobile customers. Its Shaw GO WiFi offering complements the company’s TV Everywhere initiative.
Recently, Shaw Communications and Rdio, Inc. announced a marketing, content, and promotion partnership. Rdio is the leading digital streaming music service in Canada. Shaw’s CEO, Brad Shaw, said, “Rdio is the best available digital streaming music experience and a great complement to our leading broadband and Shaw Go WiFi services.” The company’s Shaw Go WiFi initiative currently has more than 35,000 hotspots.
In 2013, Shaw worked on a major upgrade of its network to convert television analog tiers to digital. The upgrade considerably increases the capacity of its network and allows Shaw to expand its internet, HD, and On Demand offerings.
This past January, Shaw’s board approved an 8% increase in the equivalent annual dividend rate to $1.10 on the company’s Class B Non-Voting Participating Shares. Shaw’s dividend yield is 4% and its five-year average dividend yield is 4.3%.
For dividend increases and healthy dividend yields, consider Rogers and Shaw. These two companies are top players and performers in Canada and deliver income consistently to investors.
