BT Group PLC

BT Group PLC (LON: BT.A) is an FTSE 100 listed telecommunications company, engaged in providing fixed and mobile telecommunications and related solutions and services.

On 28 July 2022, BT Group expects to release its results for Q1 FY23.

Rating Rationale – Watch at GBX 179.54

• FY22 Results: The company reported a decline in top-line by ~2% YoY in FY22 to £20,850 mn due to decrease in Enterprise and Global. Profit after tax also decreased by ~13% owing to remeasurement of its deferred tax balance.
• Overvalued Multiple: On a trailing 12-month basis, the Group reported an EV/EBITDA multiple of 4.7x compared to industry (Telecommunications Services) average of 1.4x.
• Debt Profile: Net debt of the company increased to £18,009 mn as of FY22 end, compared to £17,802 mn as of FY21 end.
• Macro Risks: The present macro scenario is very volatile in nature, with inflation at peak levels and hike in interest rates by major Central Banks.
• UK Joint Venture: On 22 July 2022, the Group has updated that the Competition and Markets Authority (CMA) has approved for the UK Joint Venture between BT Group and Warner Bros. The proposed JV is expected to create a new sport offering for the UK & Ireland.

One Year Share Price Chart

Conclusion

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Based on the uncertain macro conditions, decline in revenue, and current trading levels, a “WATCH” recommendation has been given on BT Group PLC at the current market price of GBX 179.54 (as of 26 July 2022, at 08:47 AM GMT+1).

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is 26 July 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings.

Note 4:  Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Note 5: Dividend Yield may vary as per the stock price movement.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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