Analysts at Deutsche Bank argue that BT Group’s (LON:BT.A) past is catching up with it, Proactive Investors reports. The comments, which came in a Christmas-themed note on the former telecoms monopoly, follow the broker’s forecast that the FTSE 100 company may have to spend nearly twice as much as it had planned on upgrading the UK’s broadband network.
BT’s share price closed little changed in pre-Christmas trading today, adding 0.04 percent to end the session at 274.10p. The stock marginally outperformed the benchmark FTSE 100 index which ended the session 0.21 percent lower at 7,587.77 points.
BT seen as Ebenezer Scrooge
Proactive Investors reported today that Deutsche Bank had compared BT to Ebenezer Scrooge from Charles Dickens’ novel ‘A Christmas Carol,’ noting that “the ghosts of networks past and present reminded Scrooge how his once vast empire had retreated to its lucrative core, though one besieged with customer complaints”.
The comments came as industry regulator Ofcom pressed the former telecoms monopoly to give more independence to its network division Openreach this year. The watchdog further slammed the company with a record £42-million fine for cutting compensation payments for delays in connecting high-speed business lines, and pressured the group to cut the price of its landline-only package. Earlier this week, the government rejected the telco’s voluntary offer to improve broadband speeds, instead confirming that high-speed broadband will be delivered by a regulatory Universal Service Obligation.
“The future vision of alternative full-fibre operators whilst ScroogeCo sweated its copper, horrified Ebenezer and he regretted not having invested more and sooner, but he remained mesmerised by the mantra that he must be afforded a fair return,” the analysts continued in their Christmas-themed note on the former telecoms monopoly.
2018 to tell all
“Will Ebenezer awaken on Christmas morning with a new willingness to invest in the distant rather than near-term future? 2018 will tell all,” Deutsche Bank concluded, as quoted by Proactive Investors.