BT share price has recoiled. Is it a good buy ahead of Q1 earnings?

By:
on Jul 26, 2022
  • BT Group will publish its FY and first quarter results on Thursday.
  • Analysts expect that the company’s revenue for the quarter will be £5.01 billion.
  • BT’s 40,000 workers will go on strike on Friday.

The BT (LON: BT.A) share price moved sideways as investors wait for the upcoming first-quarter earnings by the British telco. The stock was trading at 179.55p on Tuesday, which is slightly above this month’s low of 171.95. 

BT earnings ahead

BT is a leading company that provides voice and data solutions to millions of people in the UK. The firm provides its solutions through several brands like BT, E+, Plusnet, and OpenReach among others. 

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BT has made headlines in the past few weeks. For example, the Competition and Markets Authority (CMA) approved the joint venture between BT Sport and Eurosport, a company owned by Warner Bros. Discovery. The new JV, which is 50:50 will create a new sports offering focusing on the UK and Ireland. 

BT also made headlines when its workers voted to go on strike, the biggest in decades. Over 40,000 workers of the company are expected to strike on July 29th and on 1st of August. Union bosses are arguing that the recently announced £1,500 was inadequate to help staff deal with the rising cost of living. 

The next key catalyst for the BT share price will be the company’s earnings that are scheduled for Thursday this week. 

Analysts expect that the company’s group revenue will be £5.01 billion while its EBITDA rose to £1.89 billion. This growth will be driven by its OpenReach, whose revenue is expected to rise to £1.4 billion while its consumer business is expected to have risen to £2.47 billion. 

For the FY22 year, analysts expect that the company’s revenue dropped by about 2.5% to about £20.8 billion. They also expect its revenue to rise to £20.9 billion and £21.1 billion in the next two financial years. At the same time, analysts expect that the company’s dividend per share will drop from 7.7 pence in 2022 to 7.54 pence. 

BT share price forecast 

bt share price

The four-hour chart shows that the BT stock price was forming a symmetrical triangle pattern since March. It then made a bullish breakout in June this year and rose to a high 196p in July and quickly pulled back to a low of 171.45p. Now, it remains below the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved below the neutral point at 50.

Therefore, the BT share price will likely resume the bearish trend as sellers target the key support at 171.45p after it publishes its quarterly results.

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