If I’d invested £1000 in BT shares in 2022, here’s what I’d have
BT (LON: BT.A) share price has bounced back in the past few months as the ongoing rotation to value stocks continues. The company is seen as a bastion of value even as the country teeters towards a recession. BT shares were trading at 156p on Friday, ~41% above the lowest level in December. This recovery coincides with the strong performance of the FTSE 100 index.
BT performance in one yearCopy link to section
BT has been an underperformer after the government privatized in the 1980s. The shares have plunged by more than 80% from May 2000, meaning that investors have lost a fortune. These losses are more pronounced in dollar terms since the GBP/USD exchange rate has dropped by more than 20% in this period.
BT share price has had an eventful year. On April 21st 2022, the shares were trading at 183.90p. It then crashed to a low of 111.30p on December 13 as the company faced significant labor challenges. It has now bounced back by over 40% from its lowest point in December last year.
In all, BT stock has dropped by ~15% in the past 12 months. Therefore, if you invested £1,000 in its shares, you would have 8.7 shares in the company. At the current price, these shares would be worth about £982, meaning that you would have lost £17.
BT Group has an annual dividend yield of 4.8%, meaning that your investment would be worth about £1,000.
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Is BT a good investment today?Copy link to section
With the BT share price rising, some investors could be interested investing in the company. Analysts are a bit positive about the company, with those at JP Morgan, Barclays, Credit Suisse, and Jefferies expecting the shares to jump to over 200p.
However, investors should understand that BT is essentially a boring company that has no substantial room for growth. For one, it does not expect to add millions of more customers in the next few years. Its OpenReach business is also nearing its peak.
Further, competition could continue rising, especially when Vodafone mergers with Three. Therefore, from a fundamental perspective, I would recommend other companies that have more room to grow in the next few years.
From a technical perspective, the stock could continue rising in the near term because it seems like it has a bullish momentum.