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Is this from that poundf website? Hahahahahahahaha
As of today the forecast for the December 2020 BT average close price is 144.88.
No flannel or waffle as none required.
" we need BT even if got to a point where it had to be nationalised as a non profit organization..... "So BT will always be here... "
Couldn't agree more. Yes it is absolutely critical to the country. It's just I've never crystallised that thought. It may offer some comfort to long term holders seriously under water, as maybe even if it were nationalised due to some unrecoverable financial catastrophe I think the govt would allow holders to remain holders for any possible future years dividend even if the capital value of the SP was kicked into the tall grass indefinetly.
Now that's the very long term future sorted in a some sort of parallel universe scenario. All that's needed now is an accurate assessment of where the SP be in 12 months time. :) :)
Wasn't going to post further tonight as got to be up hours before the crack of dawn tomorrow, but whilst admitting you have a point Lamtree, following your assertion to it's bitter end and the ruination of BT completely, the political fallout afterwards almost guarantees BT can never go to the wall.
What if Lloyds had gone down the tubes after that bailout of public money and failed, all blamed on due to some restrictive price control order whilst under Govt control? Think of the political riot that would ensue; someone's political career would come to an end. Same for any other companies in the past if the reason for failure was given as a single restrictive govt pricing policy.
If you're right, and the govt allowed Ofcom to still impose restrictions on what BT could charge customers right up to say BT announced to the world they were filing for insolvency and cited inability to offer a credible alternative rival to customers has now reached a tipping point, but had they been allowed to function free of restrictions on a level playing field, then they might still be solvent - think of the political fallout.
BT employs - get ready for this - 106,700 employees (yes, that's yet to be reduced by 13,000 as announced previously but that will still leave 93,700 !)
Can you imagine the political fall out if the media reported on circa, one hundred thousand employees thrown on the scrapheap in one go, directly because of a single govt policy? Has there ever been a higher figure in recent history? Especially when the BOD were informing the media; not necessary if we were allowed to compete without restrictions, and at no cost to the govt, if we were allowed to be free to offer customers a competitive pricing package. Govts could fall! Not a single politician in any party in power would allow that on their watch. They'd never recover if they did.
So yes, you do have a point but in the same breath even if the SP takes longer to recover than anyone forecasts, one can be pretty sure it would almost be impossible for BT to go the wall whilst under govt restrictions. Hadn't thought of it that way before.
Hi NigeCo,
Thanks - Kind of you to say so.
Although I don't regard myself as having 'well informed comments' on BT the physical business, I do eagerly look at its SP trends and each accounts released, in a rope-my-way-through way, with help provided from subscription-paid data providers. That's why there's neary a peep from me on copper, fibre, backhaul etc.,
There's several of you on here, either former telecoms engineers or current engineers with first class knowledge and opinions on the engineering technicalities/difficulties. So that allows me to take a bystanders, eagle's eye, overall view on those - When will the roll-out be completed? When will Ofcom allow BT the freedom from govt restrictions to charge customers as it sees fit for its services in regards to market competition?
As to keep posting; I hope to become somewhat less noisy here ( and elsewhere)
after the Q3 update. Still interested in each interim release, so not a complete disappearing act.
"So I'm keen to see the updates (next week most likely) for the future 3 years forecasts"
Hi again Velo,
Yes I'm also looking forward to next weeks updates, if indeed it is next week. You're certainly on the ball Velo with your analysis, ahead of the chasing pack. Lol
I would also agree with you regarding " Net profit after tax" it's number that pays the bills.
I forgot to say in my last post regarding what attracted me to VOD in the first place back in 2009, it was VOD's 45% shareholding in Verizon Wireless in the USA, this being their jewel in the crown. What attracts me to BT is Openreach. Once BT complete their fibre build out, BT profits and share price will fly. Just my opinion of cause, I could be wrong, but I have put my money where my mouth is and intend reinvesting BT dividends back into BT, just like I did all thous years ago with VOD. Time will tell if I'm right or wrong.
Keep the updates coming Velo, It's always a pleasure reading your well informed comments. Cheers mate.
Hi Nige,
Yes, I was in and out of VOD twice back in the day, the last out was late 2017. Only made 2 smallish profits as got out fast when things started reversing. From 2018 it was death valley to anyone buying VOD; it's only just attempting recovery now in these past few months since summer.
Good for you in entering VOD when the last worldwide stockmarket crash had more or less bottomed, yet the professional investing world was still smarting from wounds and slow to respond.
I generally don't seek out media opinions other than when I need some clarification on some factual issue, but yes generally bullish upbeat in that report. One thing in the middle of it niggles me though. The 100% misleading reporting of net profit. Quote:
"... Examining its latest results last week, the picture still looks gloomy. BT unveiled a 1 per cent drop in half-year revenues to £11.47billion, while profits were almost flat at £1.33billion... "
Whilst revenue is correct the "profits" as he calls them is v misleading.
That's PRE-TAX profits he's highlighting, not Net Profits after tax.
Besides, dividends can only be paid from net profits after tax, as it's not an expense item; and not allowable above the line. So I have a penchant for seeing net profit after tax.
And that £1.33b "profits" he mentions still has to have £265m of tax whipped away from it - and handed straight over to the taxman. They're not even bothering to differentiate anymore by delineating it as pre-tax net profit. Annoys me when they do that - and they're all at it. Careless in my view.
Net profits after tax (I shouldn't have to say 'after tax' it's implied in it's name) have shown a marked increase in the second quarter - otherwise they would be saying a lot worse than just flat!
Latest interpretations for the full year I'm seeing as an actual measurable increase over last year for net profit (Forecasts). Not a single media report hinting of that yet. Stable is their fav word currently.
So I'm keen to see the updates (next week most likely) for the future 3 years forecasts, as I just daren't post what I'm seeing on my screen for next year and the year after - in net profits only. That's net after everyone like the taxman has been paid off :)
In all this I'm seeing revenue STILL going down year after year - well into the future. I think the next update will confirm that too. Done a long piece on that and the unusual conundrum of still showing significant rise year after year into the future in net profit. But deleted the post and copy-pasted saved it as it's convoluted and rambling, need to cut it back a bit before it's respectable to be seen in public.
"BT's fwd P/E ratio is 7.88.............. VOD a fwd P/E of 19.2
Hi Velo,
Thank you for confirming what I thought that I already knew above with your excellent post, regarding the forward pe ratio's of both BT and VOD.
I was invested in VOD for 7 years. I bought VOD on 21/5/2009 @116p and invested all future VOD dividends back into VOD, I sold them on 20/5/2016 @230p my best trade to date. I made a killing. The reason for me selling all my VOD holding was down to the VOD dividend wasn't covered by profits, plus a high pe.
I purchased BT 15 months ago at 217p and this week doubled up at just under 195p, (my timing could have been better when BT dropped down to 160p). My average price now stands at 206.85p. Including dividends already received, this bring it down further to 194.22p. I feel more comfortable being in BT with a low pe than being in VOD with a very high pe. I see a lot more value in BT than VOD going forward. The value will be out one day with BT, I just don't know when that day will be.
Cheers guys excellent board this one.
Regards all.
Nige
"I have a headache Velo."
Hope that's not from the screen glare of reading my longer posts.
I have a headache Velo. Been a sh*te week for BT, reasonable for Voda.
Nearly got it on one post!
. . . Rinse and repeat the circular argument until market sentiment changes.
A lot of BT's fundamental metrics shine brightly. So do a lot of VOD's. But a recent side by side comparison show BT had more shine brightly's. That was before BT's interims came out. Will let VOD's interims surface next Tuesday then run the comparison again, with both companies latest updates put on a level playing field.
If this doesn't fit in one post @***!!!
---=---
Just having a look at the latest industry average P/E's for both BT and Vod.
And it's a fwd P/E of 11.5 for the Industry average (which is lower is than the FTSE market overall average).
- An stock with an above the average P/E is deemed to be going places with investors prepared to pay more now, for greater returns in the future.
- One that is below average is deemed to be in some sort of difficulty, or often designated 'cheap' but if the balance of metrics are mostly good as in BT's case, then it's often referred to, as a cheap, a 'deep value' contrarian stock pick for the future.
- However, below the average P/E combined with poor fundamental metrics to boot, and it's often seen as a cheap for a reason as a sort of busted flush, 'death star' and to be avoided.
BT
BT's fwd P/E ratio is 7.88 (LSE's on this site is historical not fwd looking) so is well below the industry average and also below the wider stock market average. So, well cheap. Imagine sentiment was neutral then the P/E might be average circa 11.5 which would entail the SP rising to circa 276p just to get the P/E inline with it's peers. When will sentiment fully turn in BT's favour is like asking how long is a piece of string? But should it do so, 276p is what could await it based today's P/E averages alone.
VOD
VOD has traditionally been held as having higher potential than BT and even in it's darkest falls in the SP - it nearly always stayed well ABOVE the industry average. The complete reverse of BT. Today its P/E is way, way, above the industry average and sports a fwd P/E of 19.2 !!! Almost near double the average. AND greater then the whole stock market average. So, expectations high for VOD, and then some.
Imagine if BT were so highly rated by the market and it too, held a P/E ratio as VOD with a P/E of 19.2 - What would the SP be then to reflect the same P/E ratio now, today? It could only do that if the SP increased 66.9% above the industry average thus bringing BT's price up further to circa 460p ! (But up to now, only VOD gets to wear big P/E ratios).
--------------------
BT's first job is to achieve parity with plain ol' average and come out of the dark cellar.
If it got to just average then at today's averages (which change over time) it has the potential to rise the SP to the 276p area (at today's prices).
But when? I can't say. All depends on how long the BOD take to sort out the market's concerns over BT. At the moment the SP is seriously under rated against the average, hugely so.
Is the market right - or is BT a bargain 'hidden in plain sight'?
It can take years to get that answer. Already I remember posting of this exercise at least 2 or 3 times over the past year or two and still no uprise in the P/E because the SP won't let it.
And the SP can't let the P/E rise - because the market won't let the SP rise.
Rinse and repeat the circular argument until market sentiment changes.