- As Omicron sweeps through Canada, Cineplex (TSX:CGX) and Cogeco Communications (TSX:CCA) have been trending in the stock market.
- The COVID-19 and its new variants are clouding the entertainment industry, especially cinema, and stalling the country’s economic recovery.
- Some Canadians consider this an investment opportunity to gain significantly when the sector rebounds.
With omicron cases rising across Canada, government officials are undertaking different necessary measures to prevent the variant’s spread. This move is seeing the closure of gyms, restaurants and cinema halls once again.
As a result, some entertainment and communication stocks are likely to see a dip in their prices.
On that note, let us explore the performances of Cineplex Inc (TSX: CGX), a leading movie theatre chain in Canada, and Canadian cable operator Cogeco Communications Inc (TSX: CCA) in the stock markets.
Cineplex Inc (TSX: CGX)
Reports recently claimed that Cineplex Inc has temporarily laid off some 6,000 of its part-time employees amid its movie theatres and entertainment sites facing shutdown once again due to the rising omicron cases.
On November 15 last year, the company, in association with Scotiabank (TSX:BNS), announced that it is set to open its VIP Cinemas University District located in Calgary for adults.
Stocks of Cineplex, which closed at C$ 12.84 apiece on Monday, January 10, has delivered a return of over 32 per cent in the last one year. The entertainment scrip is also one of the top communication stocks on the TSX at the moment.
The entertainment company noted a theatre attendance of 8.3 million and a total revenue of C$ 250.4 million in Q3 FY2021, which was a year-over-year (YoY) increase of over 310 per cent.
Image source: ©2022 Kalkine Media®
Cogeco Communications Inc (TSX: CCA)
Cogeco Communications Inc is also one of the top communication stocks on TSX, currently holding a return on equity (ROE) of 17.42 per cent.
The Montreal-based communication company is set to announce its financial results for the first quarter of fiscal 2022 on Friday, January 14.
In its previous quarter of Q4 FY2021, the cable operator posted a revenue of C$ 632.7 million, which was up by 4.5 per cent from the previous year.
The company earned a profit of C$ 103.4 million in Q4 2021, notably up from C$ 96.1 million a year ago.
Cogeco Communications saw its shares close at C$ 102.65 apiece on Monday, having jumped by over four per cent in the past year.
Entertainment and communication companies can face some hiccups amid rising COVID-19 cases. However, businesses with robust financials and operations are likely to weather the economic setbacks triggered by the COVID variants.
In all cases, investors should ideally research about a company’s business footprint to harness significant profit in the future.
Also read: 5 best TSX value stocks to buy in 2022