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Tuesday’s analyst upgrades and downgrades Add to ...

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Inside the Market’s roundup of some of today’s key analyst actions

CIBC World Markets analyst Robert Bek upgraded his rating for stock of Cogeco Inc. (CGO-T) as the discount to his net asset value projection approaches a record higher.

“Cogeco Inc. (CGO) is one of those rare breeds of company in the S&P/TSX where value is largely derived from holdings in another publicly traded vehicle,” he said. “In the case of CGO, this would be through its underlying ownership of 15.7 million shares of Cogeco Communications (CCA), which comprise about 93.5 per cent of CGO’s net asset value. The remaining 6.5 per cent of CGO’s asset value is derived from its ownership of 13 radio stations across Quebec and a news agency, and through the management fees charged by CGO to CCA. Given this structure, one would think that the underlying performance of the two stocks would track each other to some extent. This simply hasn’t been the case of late. Since the start of 2014, CGO shares have traded sideways (up a modest 1.5 per cent) while shares in CCA are up some 25.5 per cent over that period.”

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