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BT Q3 results: how will they move the share price?

BT has recovered from a record low, but barring some impressive Christmas trading there is unlikely to be much good news in the upcoming Q3 results.

When is BT’s results announcement?

BT reports third-quarter (Q3) results on 30 January.

Get the latest updates on BT's earnings as they happen

BT results: what does the City expect?

Labour’s election defeat removed fears of nationalisation for its OpenReach infrastructure division, but this small piece of good news does little for the firm or for its beleaguered share price. Investors will want to see further progress on the new superfast broadband rollout, a key intiative in retaining customers, while signs of better trading over the last few months may help stem the losses in the shares. Forecasts point to a decline of 1.7% for Q3 revenue and 3.7% for earnings.

How to trade BT’s earnings

At 7.1 times forward earnings, BT shares are still cheap, but they have been getting cheaper since late 2015, with no sign that bargain hunters are going to be rewarded for their patience. A forward dividend yield of 7% is not excessively high, but so far there is at least no sign of a cut in the payout, even if an increase is even less likely. Continued pressure on cash flow does mean that the dividend is not a permanent fixture.

BT shares: technical analysis

BT hit an all-time low in August at 154p, and while a rebound has taken place since then it has been a choppy ride. Two attempts to clear 200p have failed, so further long-term upside requires a push above this level. January saw the price drop below the November support zone around 180p, so while it has stabilised for now at 170p, further declines bring 154p back into play.

BT chart Source: ProRealTime
BT chart Source: ProRealTime

BT: not for widows and orphans

To underperform the FTSE 100, is an achievement. To do it by such a wide margin is impressive. BT is down 60% over the past five years compared to a 10% gain for the FTSE 100 on price alone. There is no sign that this has changed, and so while investors look for renewed strength as the bull market moves into a new year, they are unlikely to find it in BT.

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