BT share price wavers after results: Time to buy or sell?

BT Group share price slipped and then pared back those losses after the telecommunications company published results of the last financial year. It dropped to 222p, down sharply from 6.95% from its highest point this year. So, is it safe to buy the dip?

BT Group published its annual results today 

BT Group, the biggest telecom company in the UK, published its annual results, which provided color on its business.

These results were largely in line with what we wrote in our preview a few days ago. The most notable part of the results was its broadband line losses, whose subscribers dropped by 203k in the last quarter, bringing the annual figure to 825k.

On the other hand, the company's Openreach FTTP added 2.2 million customers, bringing the total connected premises to 8.8 million.

These dynamics mean that its revenue dropped by 3% in the last financial year to £19.3 billion, which was in line with what analysts were expecting. 

Still, the management’s actions helped it grow its profit modestly. Its profit before tax rose by 8% to 1.43 billion, while the after tax one jumped by 2% to over 1.07 billion. 

BT Group’s segments performed as they have always done in the past few years. Its consumer, business, and Openreach revenues dropped by 2%, 2%, and 15% in the last financial year. Similarly, the EBITDA fell by 2%, 5%, and 29%, in the same period. 

Most notably, the management continued to return funds to its shareholders. It announced a 8.32p dividend, and outlined a policy to continue growing its payouts to shareholders. Its goal is to now grow its free cash flow to 2 billion pounds in 2027 and 3 billion pounds by the end of the decade.

Is BT a good stock to buy?

BT Group share price has done well in the past few months, rising from a low of 173p in November 25 to the current 226p. This surge happened as the company’s guidance showed that its broadband churn will be lower than the 1 million+ that analysts were predicting.

The company is working to fix some of its historical challenges, including exiting its international business. It is also leveraging artificial intelligence to cut its operational costs.

Analysts expect that its revenue will ease a bit to 19.31 billion in the next financial year followed by 19.29 billion in the following year. Its EBITDA is expected to keep growing, potentially to 8.31 billion in 2028.

Therefore, there are signs that the company is a good investment, especially for dividend-focused investors. 

BT Group share price technical analysis

BT stock chart | Source: TradingView

The daily chart shows that the BT stock price has done well in the past few months, which pushed it to a high of 241.7p. It then pulled back a bit as investors waited for the earnings.

The stock has moved below the neckline of the inverted head-and-shoulders pattern. It has remained above all moving averages, a sign that bulls remain in control.

Therefore, the most likely scenario is where it rebounds, potentially to the year-to-date high of 241p. A move above that level will point to more gains, potentially to 250p.