UBS has pointed to ‘significant uncertainties’ for BT Group (LON:BT.A) which continue to cloud the telecoms giant’s future, Proactive Investors reports. The comments came as the broker reaffirmed its ‘neutral’ stance on the company yesterday.
BT’s share price, which came under pressure in the previous session, has advanced in London trading this Wednesday, having gained 2.08 percent to 171.84p as of 10:14 BST. The stock is outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.84 percent higher at 7,328.73 points. The telco’s shares have given up more than 23 percent of their value over the past year, as compared with about a one-percent rise in the Footsie.
UBS weighs in on BT
UBS reiterated its ‘neutral’ rating on BT yesterday, following a ‘meet the new boss’ event with the telco’s chief executive Philip Jansen. Proactive Investors quoted the broker as commenting that the new CEO had given his perspective on the high-speed fibre broadband roll-out, where there remains uncertainty on the longer-term scope of the build out and who is going to carry out the process in rural areas.
UBS said that there was no update on how any expanded fibre rollout would be financed, leaving investors to continue worrying about a dividend cut. The analysts further noted that while Jansen had indicated that T “will not sit back and lose market share,” he suggested moves by competitors not to charge a premium price for 5G mobile are “not rational”.
“Until there is visibility, we think it will be difficult for the share price to re-rate in the near-term,” UBS concluded, as quoted by Proactive Investors.
The comments come after BT updated investors on its first-quarter performance last month, posting a fall in revenue and profits.
Other analysts on telco
Deutsche Bank reaffirmed the former telecom monopoly as a ‘sell’ today, without specifying a target on the BT share price. According to MarketBeat, the blue-chip company currently has a consensus ‘buy’ rating and an average valuation of 258.33p.