Member Info for fleccy

"Apart from the fibre build, there was very little good news. Assuming everyone can agree cutting costs whilst reducing revenue isn’t particularly good news"

Aus feel free to go back through my posting history, I've consistently said that BT will lose customers to Altnet competitors and that my investment thesis is based on BT's transformation to an fully converged network growing Net Profit, even with declining revenue. Aus you keep banging on about revenue growth, but an investment in BT is more about value, income and BT becoming leaner; If you want to take a punt on Growth then pick a US tech stock and pile in there, personally I'd rather go for undervalued unloved stocks that pay dividends.

Aus if you really are still invested in BT, why is that? And if you are you must believe the stock holds some value, and at some point give a good return, what is your reason for holding?

The breakup value of BT is more than the current Market Cap valuation. BT's total debt is around £20.85 Billion, but £4.81 Billion of that is Lease Liabilities, which is arguably a cost of doing business and not financial debt, and is only reported as debt due to the IFRS 16 accounting standard; So the Financial debt comes in around £16 Billion. BT's current Market Cap is around £17.5 Billion, but Openreach alone is estimated to be worth between £20 and £40 Billion; EE has to be worth more than the £12.5 Billion BT purchased it for, since BT has invested in spectrum, towers and licences which should add to the original purchase price. Openreach and EE alone could be worth up to £55 Billion and that doesn't include all the other parts of BT's businesses which also have value.

The current valuation of BT, and Telecom stocks in general, is a joke so I'm not worried about piling into a stock that, in my opinion, is cheap as chips. In my opinion the market has been gaming Telecom stocks and driving down valuations for many years, with private equity moving in when the stocks become distressed and denied the ability to benefit from rights issues due to undervaluation's; What happened with Telecom Italia and KKR is a prime example of what I'm talking about. Incidentally the EU are now investigating KKR in reference to possible incorrect or misleading information given during the acquisition approval process. BT's finances are on a lot firmer footing than Telecom Italia's was, so it's unlikely BT will be cajoled into bending the knee like Telecom Italia was. There are other examples of Private Equity eying Telecom infrastructure, particularly in the mobile space with Tower assets being a prime target.

I meant that I'd benefit by realising a gain on my BT shares, I wasn't suggesting I'm in favour of a bid.

Bidboy only someone who's bonkers would believe a bid for BT is on the cards. Even though I'd benefit from a bid I'm 99% certain a bid isn't on the cards, because of the UK's national security legislation. No foreign company would attempt a BT takeover, because the Government has all but told them not to bother.

You can bang the bid drum as much as you want, but it just makes you look obsessive and idiotic; Especially since you regularly disappear and reappear with new usernames, clearly you have issues.

"My money is still invested (although reduced by half) with BT because I still expect them to win through, but every financial result I read is reducing my certainty"

Aus if I held your view toward BT I would get out asap, why would you hold a stock you have uncertainty about? Why don't you sell your "reduced by half" holding and invest in something you believe in? You seem to like Comcast and Liberty, why don't you unload your BT stock and pile into stocks you clearly believe in. If you really do believe BT will win through you'd post your reasons for believing that, instead 99% of your posts are negative and usually attacking other people's views who do believe in BT's strategy and prospects. My reasoning for investing in BT is really simple, it's based on reducing capex and cost savings, and I've been consistent in expressing that view for years; And I've backed up that view by increasing our BT holdings significantly and putting my money where my mouth is.

"After the upcoming budget, think your divi take will shrink due to tax"

Reeves would have to drop the tax free income allowance, because my wife has no other income, and start taxing ISA's. I'm not worried about the budget as far as income tax is concerned, my may concern is what they may do around council tax bands.

"Invests in three of the stock market's biggest losers - BT, Lloyds and Voda"

Still showing an £11,000 paper gain in BT and an £86,000 Paper gain in Lloyds, if that's losing I'll take it every time. My BP shares are also showing a paper gain of £17,000, the only stock I'm currently showing a paper loss for is Vodafone at £10,500 under Book Price.

PRK you should email Sunil Bharti Mittal and share the benefit of your expert insight into BT, I'm sure he wont be interested in your point of view.

Clearly certain entities are looking to push BT's share price down, for whatever reason. Lots of negative articles being pumped out and short interest increasing, we've seen this many times before with BT, it's very Deja Vu

PRK everyone talks their own narrative to support their own mindset, including me, we all have varying vested interests. PRK you want to see BT drop to support your bailing out at sub 150p; Aus has his own motives, which are unclear, but he's very defensive when it comes to VMO2, I have no idea why; For me, I'm heavily invested in BT and nobody wants to see their shares drop for no apparent reason and although I'm heavily invested in BT, and a strong believer in their strategy, as much as I don't like to see the price drop it isn't something that worries me greatly.

Should BT drop to historic lows I'll happily fill my boots with more stock and wait, I wasn't worried when they dropped to £1 and it wouldn't worry me if BT's price visited there again, not that I think it will.

Aus your arguments are weak and transparently anti BT, you still haven't told us why you love VMO2 so much?

Clearly that's wrong, yesterday the daily volume was above average and the share price climbed, today the volumes are mediocre and the share price drops 4%? If today's volumes had been big then I could have gone along with the negativity narrative, but they aren't so I wont.

Aus why do you love VMO2 so much, any criticism of them and you come out in defence, anything positive directed toward BT and you inject negativity, why is that?

Just got back in and noticed BT down 3.5%, anyone explain why? Because I can't find any headlines to explain the drop. The share price went up yesterday after the results so it can't be that, I can only conclude that this is part of the same gaming that's afflicted BT in the past.

"Fleccy - firstly not it’s not & secondly I think PRK has already covered why reducing costs doesn’t work well if revenue is also falling off a cliff"

Aus PRK is wrong and you're wrong. BT's cost savings, through the changes I've described, are written in stone and telegraphed by BT going back as far as Philip Jansen taking the helm in the early months of 2019. Kirkby is just continuing the same strategy BT was pursuing over 5 years ago, but being credited with BT's turn around as though something has radically changed since she took over. As I've told you before, I worked in Telecoms from the start of my career to retiring in 2019 and I've seen all the various evolutions in network hierarchies ranging from FDM and PDH all the way up to DWDM. The move to convergence, FTTP and 5/6G, will be the last major evolution for generations since there's nowhere else to go. Apart from tweaks and minor upgrades, I imagine this latest Capex cycle will be the last big one; I've worked on everything from Microwave Radio, Routers, Voice and Data, worked as part of a NOC and even worked in a Subsea terminal site terminating subsea cables, so I understand Telecoms. Where's the future Capital expenditure once everyone has fibre to the premise and 5G cells blanketing the country? Unless some new physics breakthrough discovers some sort of StarTrek style sub space communication, we're reaching the bandwidth limits for all communication technologies. Any revenue lost to new competition, which was expected, will be more than offset by future cost savings. If BT was freely allowed to compete on price, they could destroy the business model's of all the Altnets and give others a serious head ache too, everyone knows it but they rely on OFCOM to reign BT in. To suggest that BT is at risk from Altnets, ignores BT's incumbent national advantage and scale.

No it's about ITV, which in Monty Python terms could probably be described as a dead parrot.

https://www.youtube.com/watch?v=vZw35VUBdzo

"You are arguing about things in the future changing which you think change the equation & you might be right too, you are betting on these things coming true

But no one knows the future for sure & you are only right if everything you predict happens"

Actually many of BT's future cost savings are set in stone; Like PSTN switch off, building closure program, reduction in staff numbers, ending of legacy network and transformation to a fully converged network. BT's move to PON will massively reduce their power bill, they'll reduce their exchange building footprint to around a thousand, but before that their capex bill will drop massively, none of this is hope, it's a dead cert.

Well do as you wish PRK. I'm invested in both BT and Vodafone, but my investment in BT is nearly double my investment in Vodafone, and my Vodafone investment is well over £100,000. I like both companies, but I view BT as the safer play offering more investment certainty.

I'm not sure what you mean there PRK. Vodafone aren't cost cutting, in the UK alone they need to spend big to upgrade the Three and Vodafone cell sites with new Nokia equipment:

https://www.lightreading.com/5g/nokia-is-the-big-winner-in-vodafonethree-5g-refresh

https://www.lightreading.com/5g/bt-thinks-it-can-beat-vodafonethree-in-5g-by-four-years-no-wonder

In Germany Vodafone are investing in joint ventures to lay fibre, and investing in the Cable network purchased from Liberty Global. I'm not sure what Vodafone management were thinking when they bought Liberty's German cable assets.

VMO2/Nexfibre are investing big to play catchup with BT/Openreach and will still be years behind Openreach by 2027.

It's true that Altnets are cost cutting, but that's because the Finance taps are all but turned off and they're stopping building new network as a result.

"Heres the problem cost cutting doesnt add sp much value if revenues keep declining"

That's where patience comes into investing. BT's capex will fall of a cliff from 2027, in the meantime the current debt is just part of the narrative to bash BT. Although Net Debt currently sits at £20.853 Billion, £4.45 Billion of that is lease liabilities and lease liabilities are declining year on year. If BT thought debt is a problem, it's well within their means to do something about it, the fact they're increasing dividends suggests debt isn't a problem.

"I dont think the fibre rollout is capable of doing anything other than churning existing revenues with gradual market deterioration from competition"

That's because you don't understand my investment case for BT, you should look back through my posting history to see my point of view. I view BT as a cost cutting and dividend value play, if you're looking for revenue growth then I agree BT isn't for you, but BT's assets and ability to cut costs will grow the bottom line Net Profit for years to come.

Aus you'll agree with anyone singing from the same hymn sheet as you, the truth is these days stock prices are driven narrative rather than fair valuation. Look at US tech stocks like CrowdStrike and Palantir to understand where I'm coming from. In the UK Rolls Royce is a prime example of a stock going ballistic based purely on narrative and momentum, how can Rolls Royce be valued at £97 Billion based on their earnings?

I could fill an entire post with what's currently wrong with many stock valuations, with price discovery thrown out of the window, I just can't be bothered right now.