A great case for BUY BT group PLCHello,
Understanding BT Group Plc:
Company Overview and Financial Performance:
BT Group Plc operates as a holding company that provides a range of communication services. The company's operations are divided into distinct segments, including Consumer, Enterprise, Global, Openreach, and Other. Within these segments, BT Group Plc offers services like mobile, broadband, home phone, and television to consumers, while also catering to businesses and public sector organizations with communication and information technology services. While the company's growth might not have met all expectations, its stability is evident in its financial performance. Over the past five years, BT Group Plc has consistently generated an average net income of USD 2 billion and amassed a total revenue of USD 29 billion. Notably, even during the pandemic, the company managed to maintain profitability, showcasing its resilience.
Exploring the Company's Website:
Website Insights and Strategic Direction: A visit to BT Group Plc's official website provides deeper insights into its strategic position. As a prominent player in the UK telecommunications and network landscape, the company's influence is notable. The website highlights the company's dual role as a leading UK provider of telecommunications and networks and a global communications services provider. It also proudly announces a return to revenue and EBITDA growth after a six-year period. This turnaround is a testament to the company's commitment to creating value for all stakeholders. The website reinforces the company's dedication to enhancing value through strategic actions.
Key Highlights from Quarterly Statements:
Strategic Progress and Financial Milestones: The company's quarterly statements reveal substantial progress aligned with its strategy:
An impressive 43% increase in FTTP2 (Fiber to the Premises) build-up, reaching 10.3 million premises, with 3.1 million take-ups.
Consumer FTTP connections surged by an impressive 50%, totaling 1.7 million.
5G coverage extended to a significant 68% of the UK population.
Successful completion of the BT Sport joint venture.
The establishment of a market-leading Business CFU3.
Realization of £2.1 billion in gross annualized cost savings, achieved at a cost of £1.1 billion.
Technical Analysis and Investment Opportunity:
Technical Analysis and Market Position:
Engaging in technical analysis can aid in identifying promising investment opportunities. BT Group Plc's stock charts can provide valuable insights, allowing investors to make informed decisions and capitalize on advantageous prices. To maximize investment understanding, combining technical analysis with fundamental analysis is crucial. Notably, the company's current stock position offers potential as it trades at a lower point. Coupled with its robust fundamentals, this could present an attractive entry point for investors seeking long-term gains.
Recommendation:
In light of the comprehensive assessment, it's recommended to consider a long-term investment in BT Group Plc, given its established market presence, strategic progress, and potential for future growth.
For more in-depth information about the company, please visit www.bt.com
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BTQ trade ideas
BT.A - BT GROUP PLC - LONGThis is an analysis of BT GROUP PLC - a British telecom company, the following is strictly my own personal opinion and does not constitute financial advice.
Key numbers:
Dividend yield TTM - 6.47%
P/B - 0.81
P/E - 5.56 (currently)
Market cap 11 817 MGBP (11.8BGBP)
Analyst estimates:
Analyst estimate average for BT.A is 188.5 GBX which is equivalent to a 65.42% increase from todays price.
Key information:
CEO has been replaced with Telias ex-CEO Alison Kirkby, she claims to have the same vision for the company as previous CEO Phillip Jansen. Telia stock has been following a similar trend as BT.A, and as news was released today both shares dropped. However, analysts believe BT.A is overweight, and the consensus among analysts is that BT.A is a buy/strong buy.
Technical analysis:
BT.A made a bullish divergence on recent support level at 120GBX 11th of July, likely due to uncertainty around the next CEO of the company, the stock consolidated until today. As news came out regarding the change of CEO, shares dropped in price, dropping down to previous support on 110-112GBX - still within the lines of a bullish divergence.
Strategy:
I am currently in possession of BT.A shares with a GAV of 123GBX which I am looking to hold. The lowest sell side analyst target is at 100GBX, and if price continues to drop to support at 95-100GBX and the divergence between relative strength and price continues, I will be looking to increase my position in the stock as long as no unforeseen news arise.
If the price holds above support on the 110GBX level I will not add to my position, and I will follow my original strategy to wait for price to get closer to AVG analyst estimate, or take profit around 160GBX at the stocks previous high. Taking profit at 160GBX will net roughly 34-35% gain when factoring in dividends paid out 13th of September.
Should price drop below the 95-100GBX support level, I will re-evaluate my position and look to liquidate the shares if there is any indication that the fundamental situation of the company has changed for the worse, or if the bullish divergence becomes invalid.
BT Group Plc *safe investment opportunity - low risk*
On the above monthly chart price action prints a higher low following a 80% correction since early 2016. Shortly after a 2:1 stock split. A ‘great buy’ opportunity now exists.
Why Bullish?
1) Regular bullish divergence between price action and the money flow index (MFI) - oscillator on bottom of chart.
2) Trend reversal. A higher low was printed from the crash in price action back in 2009.
3) The 3-month chart below provides a clearer picture of the overall trend between price action support and resistance. Clearly an amazing opportunity.
A buy from 130p is amazing if you can get it. Expecting price action resistance between 160-180.
Target? Around 800. This will take time 5 - 6 years but it beats cash resting in the bank account with no interest like the past 10 years!
3-month chart:
BT Group Stage 2 EntryBT Group has been a container ship stuck in the Suez Canal for years, it looks like it may have finally turned around. Its recently had some government decisions on its fiber rollout go its way. Its an interesting play on 5G and BT although more like a utility when it comes to the internet, has some impressive communication businesses such as EE and Sports.
COVID-19 RecoveryBT has been operating on full steam since lockdown and with Key-Worker status they are still performing well. Reaching new highs on the basis of post-lockdown hope we should start to see a steady incline. Once we reach and break past 150 with even more market positivity, tied in with 5G releases and technology, we could see this being the new support floor.
Why I am buying BTThanks for viewing,
I'm not sure I have the time to include my full reasoning.
- June 2020 reported both revenue and EBITDA down 7% yoy, which is certainly less of a decline than a lot of businesses - and way less than the drop in UK GDP overall.
- Profitability at end of March 2020 was pretty good, and after reporting an interim dividend of ~4.7% (the interim dividend is 30% the size of the final dividend) they halted dividends for the 2020-2021 year. That is quite prudent, and the -7% revenue numbers reported months after that seems to suggest that the hit to profitability will not be too great.
- It is quite hard to get a handle on where we are in the overall correction since 2015, but recently, the share price appears to have completed an identifiable 5 waves (of some degree) that started in October 2018. This suggests we are due at least a correction of some degree (if not a change of trend).
- An ending diagonal has formed since March 2020, this could be a bullish sign. I often see such formations at the bottom of a commodity price cycle.
- There is bullish RSI divergence unfolding - when declining price is displayed as a series of higher lows on the RSI. This, if nothing else shows a slowing of the price trend and is often present before prices change direction.
- www.macroaxis.com (its a secondary source) shows on 31 March 2020 EBITDA isn't that much lower as compared to when BT was at the top of the previous price trend - in 2015-16, when BT was worth over 500 (this was despite a major lease payment over 800m pounds in the prev annual report - which isn't paid every year). So earnings per share have dropped 30% but share price is down 80%? Seems to indicate value to me.
- They will not be paying dividends this year, which I like, it is a good idea in uncertain times. Better to re-emerge strong than to deplete oneself in lean times.
- Based on previous dividends - which are highly stable and reliable - they could be paying and over 15% return - so I expect price to go up in 2020 - early 2021 in expectation of the resumption of dividends.
- Very good dividend coverage ratio - I think only about 30% of EBITDA is distributed as dividends, so even quite large variations in profitability will still allow reinvestment in the business and for dividends to be maintained.
- I think Brexit fears are over-blown. Yes there are a number of stories that BT will lose some European contracts due to Brexit, and even if that happens, this will not represent a sizeable hit to profits.
- PE ratio is 5.67 - value investing normally recommends buying when PE is below 10-15.
- Price to book ratio is 0.66 - so the entire businesses equity and future profit stream are valued at less than 70% of just net assets. Seems to indicate under-valuation - especially for such a high dividend potential equity.
- Despite competition, they provide 37% of broadband and seem to do well against the competition in cellphone coverage.
- People still need their cellphone and Wifi is basically an essential in 21st century, whether you work from home or not. Most of their drop in revenue was due to lower economic activity in general - but the base-line revenue is quite solid.
- If you believe in the "new tech-based economy" (that has resulted in TESLA trading over 1200 times earnings) well Companies like BT will be the foundation of this, providing internet and communications infrastructure.
Medium-term I see the 0.382 fib retracement as a plausible price target at 250 (+200%). If FY 2019-2020 dividends are maintained after next year, that will still allow a 5% dividend to be paid, which is better than the average - currently 4.81% for the FTSE 100. Yahoo finance puts a fair value fr BT at 200 uk.finance.yahoo.com - so 250 isn't "pie in the sky".
Its definitely under-valued - so I will start to average in. Time horizon; buy in within the next 3-6 months and hold for 5+ years.
I guess I did have time lol
BT became a BUYGood opportunity to buy BT shares at this level - Be aware that the long term chart for BT is bearish so this becomes a risky buy... but I can promise you these are the best prices to buy the stock.
If you have any shares already invested in BT then this is a great opportunity to add to your position and benefit from a better average cost.
Arrow for directional purposes only. - Contact fro more advice regarding TP & SL.
Be clear this is an investment NOT a trade. Know the difference.
Happy Monday!
303p - 330p Long term target swing from 100p / 75p entry #ftseAs a long term investment I am looking into start scaling in slowly in BT as I believe that UK economy will thrive in next few years once this period is over.
a 300p (200% from this price level) will give a great return alongside dividend for many investors.
I believe scaling in will be a better strategy then all in.
Please do remember we might still do a double bottom at 75p!!
BT.A - BT Group - UK TelecommunicationLSE:BT.A
Based on the below fundamental analysis, it seems that there is a signal to buy for a long term investment as well.
BT Group Plc (L:BT) jumped 7.2% as a report said it was in talks to sell a multi-billion pound stake in its wholly owned network subsidiary, Openreach, to infrastructure investors to help fund an ambitious expansion in fibre broadband.