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Who do we blame for the really poor performance of the BT shares up to now .As far as I am aware Corbyn is not in government yet.
Hi Aus yes IF it happens then it could end up like Australis's very similar attempt on be dragged on for years https://www.abc.net.au/news/2019-04-23/what-happened-to-superfast-nbn/11037620
If the government part fund this rollout over regulation will never end. I think we’ve already discussed the free lunch theory when thinking about Corbyns plan (or lack of)
"Only thing is, Johnson (if he wins) will be galvanised as never before after the Labour broadband fright, to "get fibre broadband done" to use his vernacular."
If they want FTTH rolling out faster, the only company capable of managing that at increased speed is Openreach, using their current staff and approved contract cabling companies. Fibre can be run along existing overhead copper routes and as BT already have Fibre to the cabinet in many rural and semi rural locations, they really can do it faster than anyone else. The Governments easiest option is to target Openreach for increased grant funding and let them manage the rollout with faster targets.
As I mentioned a few days ago Velo,I think Boris has had a shot above the bow with BT and he may be a bit more interested In BT as he knows come the election after the present election he'll have to make BT look good as a PLC.
Good point L/tree.
I too, would expect the SP to rise on the 13th should Bojo still be No:10.
Only thing is, Johnson (if he wins) will be galvanised as never before after the Labour broadband fright, to "get fibre broadband done" to use his vernacular.
So will the market continue to bake in more govt interference?
What will market sentiment think of BT and future govt interference, despite Labour being out of the loop?
Just wait for the Friday 13th sigh of relief trend velo.
Thanks bkk & Figs - apperciated.
Tarot cards? :) :) Do they do refunds at the Tarot card shop?
To answer: Where do I see the SP in 12/24mths?
Honest answer is: I don't know. Sentiment will decide that because the fundamentals are crying out for an upward rerating as they always have. But how many years now have BT been seen, to be undervalued?
As the investment books say, with deep value stocks, you can wait way many more years than you thought possible before the market acknowledges that value too. It's why analysts are the world's worst at predicting the future SP. They can calculate the fundamentals which then become the market's expectations, but putting an SP on that, means 99.9% are usually wide of the mark. Mainly because sentiment plays such a strong part, and you just can not predict sentiment reliably, on fundamentals alone.
Sentiment in BT's case means govt interference via Ofcom and now potentiality nationalisation which would reduce BT's remaining business after the asset-grab, to a fraction of it's former value. So bearish sentiment has shown why it's been so negative towards BT.
On fundamentals (as has been the case for several years now, BT is worth well more than its current SP (that at the current moment IMO that is 275p). Have had it projected as much higher in previous years, but that's on plain averages.
Vodafone is rated more than twice higher than BT is, so if ever the market rated BT on the same scale as VOD then the future value would be circa double x 188p = so 376p and higher some more.
But for years now, VOD and BT have followed their own path on valuations and neither has moved significantly from the rating applied to them by the market. One is valued higher than the market average, the other below mkt average. That remains the case to this day.
(PS. If the market applied the plain industry average equally, to both stocks, VOD would be 90p today and BT 275p)
I do attempt to monitor sentiment mainly via moving average trend lines, and additionally TA indicators etc., etc.,
Long term the trend lines have always have been - and continue to - point downwards for BT. And mostly they've been proven correct. I get quite animated when they look like they're approaching a trend change, but it's happened only the once (and for 5 continuous months only) in the past near-4 years before reverting back to looking south. I'm looking to see if they're about to level out, akin to a bumpy airplane landing, and thus signal the floor area, if nothing else.
- Time as always, will tell.
My long term forecast is positive. 5G is being rolled out across China right now and propelling growth. Who can only do this kind of infrastructure project for UK? BT
In time the SP will outperform.
Get your own Tarot cards BKK.
Great effort and commitment in your post
But in layman's terms where do you see the sp in the coming 12/24 months
( Concludes > > > )
Q3 net profit analysts forecast for £486m
I'm seeing Q3 net profits for £553m minimum.
Q3 analyst forecasting £5.777b
TTM not seeing much higher than that. A bit more, but not much.
So it all hangs on the net profit at Q3
(That's after-tax Net Profit; pre-tax profits always dazzle - as much higher before paying taxes).
(Part 1 of 2)
Once again, the analysts Consensus forecasts for Q3 (due to complete at end of Dec) follow the same path as their Q1 & Q2 forecasts. Which is, not only bearish in outlook, but actually less than that achieved on the past 2 quarters when compared to BT's actual results.
Q1 Net profit and revenue actually beat the analysts forecast, but even so were still down on last years actuals, so the SP did not respond positively.
By Q2 it was a repeat of them underestimating BT's actual results. Q1 net profit came in with £505m - and Q2 beat the forecasters again coming in with £563m, thus giving an H1 actual of £1.068b for net profit - well above the analysts forecasts which was under £1b net profit in the high £900m's
So £1.068b net profit is in the bag and already banked. Done and dusted.
And if the Q1+Q2 were repeated for Q3+Q4 then the minimum to expect would be £2.136b net profit for the full year. As last year was £2.159b that would still represent a decrease on last year - the first in many years and hence the market's renitence towards the SP.
However using the TTM (Trailing 12 month interim updates) I'm seeing the full year forecast for net profit as £2.175b ! - an actual increase over last year!
To make that happen Q3 actual, would need to deliver circa (£553m net profit).
I'm plumping for achieving a minimum of £553m in Q3. (Q2 delivered greater at £563m remember?)
Consensus analysts forecasts out this evening are only offering £486m (Analysts mean+median/2)
Pfftt! Both Q1 and Q2 actuals beat that by a country mile. Why would Q3 crash so abysmally?
Whatever, the market is not going to like that negative net profit forecast by the analysts; so not expecting anything from the SP, especially with Dec 12th looming.
Revenue Q3 analysts forecast is for £5.777b but at least that still gets the full year revenue just about clear and over the £23b cut-off acceptability point.
TTM has it higher than that, but won't cross swords with the analysts on revenue as they have proved to be closer to the mark with revenue to date (but they've been hopeless or worse on net profit). Besides I too have revenue declining into the future.
But what's really interesting is taking a peek at the analysts very bearish forecasts for net profit and revenue for the 3 years after this financial year completes.
The bad news is, they have revenue eventually falling below £23b to £22.9b over the next 3 years.
But the good news is, they have net profit rising to £2.346b by financial year ending 2022.
I have it higher than that, but for 2022 let's go with theirs for now, as it represents the second highest net profit ever achieved over the past 6 years already so far! And that's from the permanently under estimating analysts who have under estimated ever quarter so far!
Q3 net profit analysts forecast for £486m
I'm seeing Q3 net profits for £553m minimum.
(Continues > > >)
BT have finally posted the Q3 forecasts on their site - after 5pm by the look of things. With TL saying he saw some of them yesterday I suspected BT was in posession of them all and were in the process of finalising publication of them.
Well here they are, tonight! Overdue too.
A case of same old, same old. Once again they've gone for a low Q3 net profit interchangeable with their incorrect under estimates in the previous 2 quarters. Revenue to continue its descent (expected). Came out after market closed but shows by the SP poor close, how some news leaks out beforehand with them forecasting poor net profit and poor revenue for Q3.
Will post the TTM estimates I am seeing which once again are at odds with all the bearish analysts. I've disagreed with the analysts forecasts on net profit profusely all year from the off and as luck would have it, BT's actuals saved my ass and came out as an increase on each quarter's publication. Going for the triple now :)
Q3 actuals complete at the end of December and most probably those results will be published by end of Jan next year.
Off to digest them further and translate what I'm seeing, into written form, so will post later this evening what the Q3 analysts forecasts state and post what I am seeing on my screen which for net profit is far, far, greater than all the analysts forecasts.