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BT share price: Analysts weigh in on results

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Interactive Investor reckons that the next year will be a test of patience for BT Group’s (LON:BT.A) investors with the telco pushing on with ambitious plans, Citywire reports. The comments came after the former telecoms monopoly updated investors on its full-year performance yesterday, increasing its target to pass four million premises with ultrafast FTTP technology by 2020/21, up from three million, and an ambition to pass 15 million premises by the mid-2020s, up from 10 million, subject to conditions being right.

BT’s share price, however, fell in the previous sessions following the results, with the telco also posting a drop in revenue. The shares closed nearly four percent lower at 210.75p, significantly underperforming the FTSE 100 which closed in positive territory. In early morning trade this Friday, the shares have inched 0.33 percent higher to 211.45p as of 08:04 BST, as compared with about a 0.5-percent gain in the Footsie.

Test of patience for investors

Citywire quoted Interactive Investor analyst Richard Hunter as commenting that there were  ‘ambitious plans afoot’ around BT’s 5G offerings involving a £4-billion investment which proved the FTSE 100 group’s ‘determination’ to stay in the game. The comments follow the telco’s full-year results which showed  a marginal gain in pre-tax profit driven by cost-efficiencies.

He, however, cautioned that all was not ‘plain sailing,’ pointing to a fall in net cash inflows, the pension deficit, and regulated price reductions, as well as revenues moderately declining.

“The next year will be something of an acid test for investor patience,” the analyst pointed out.

Other analysts on FTSE 100 group

Numis Securities reaffirmed the former telecoms monopoly as a ‘buy’ this week, without specifying a target on the BT share price, while UBS continues to see the company as ‘neutral’. According to MarketBeat, the blue-chip group currently has a consensus ‘hold’ rating and an average valuation of 273.75p.

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