BT Group Share Price Forecast November 2021 – Time to Buy BT.A?
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Shares of British multinational telecommunications holding company BT Group (LSE: BT.A) are in the green today, after closing on 157.80p as of November 4th, (18:03 GMT) with an uptrend of +11.01%. Yesterday, BT Group released its half-year results through the end of September. It also released an update earlier in the week related to the cost savings target. As a result, BT. A Shares were up by 5% trading over 149p at one point, with many investors wondering if it’s the right time to pick up the shares.
BT Group – Technical Analysis
According to the financial statement released by BT Group, the market cap of the company is £15.638 billion with total assets worth £50.877 billion. Revenue for 2020 was at $21.40 billion with a profit margin of 6.88% compared to $22.81 billion in 2019.
Moving averages for BT Group such as Exponential Moving Average (10)(144.43), Simple Moving Average (10)(142.29), Exponential Moving Average (20)(144.65), Simple Moving Average (20)(141.77) and Exponential Moving Average (30)(146.92) are indicating a buy action. Oscillators such as Relative Strength Index (14)(64.34), Stochastic %K (14, 3, 3)(67.28), Commodity Channel Index (20)(305.02), Average Directional Index (14)(30.23) and Awesome Oscillator(−3.01) are neutral.
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Recent Developments
BT’s share price has been struggling for quite some time now. Ever since they touched the 500p mark in 2015, it has fallen more than 61.5% to reach 192p in January 2020. It crashed as a result of the pandemic, reaching 98p at one stage which is within range of the company’s initial listing price of 87p back in 1988. Since then it has shown signs of recovery, as it reached 205p in June 2021 before falling back again. It is still up by 6.4% despite some turmoil over the last couple of months.
BT used to offer a dividend yield of 3.5%(approx.) a few years back, making it a company that income investors would buy and hold. The company scrapped the dividend completely in 2020 due to the pandemic, helping them retain some cash to focus on the launch of its full-fiber broadband. Now that the project is well underway, BT is in a position to resume cash payouts to its investors. It set the payout at 2.31p for an interim dividend, which would produce a 1.54% dividend yield. Analysts expect this to increase in 2022 as the company pushes for more cost savings.
Should You Buy BT.A Shares?
The main reason for the recent share rally was a broadband rollout, with momentum clearly on the company’s side. It has already ten communication providers under its network including the likes of TalkTalk and Sky. The company ambitiously aims to reach 25 million premises by 2026. Another reason investors can be excited about is the good cost control of the company. This was reaffirmed by the half-year results which also decreased future cost expectations.
According to the company, it has completed its goal of delivering £1 billion gross annualised cost savings ahead of its March 2023 target. However, not every metric is positive, as the group’s overall revenue fell by 3%. The company’s net debt also rose from £614 million to £18.2 billion from the last half-year. Such a debt file is large considering its size and high-interest rates could make it more expensive to issue more debt or refinance. Its market share is also being challenged by the likes of Sky, whose potential partnership with Virgin Media O2 was seen as a direct threat. Despite this, BT shares could still offer a good return in the coming years, and investors can consider adding them to their portfolios for the time being.
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