BT Group: stock drops after analyst's downgrade
(CercleFinance.com) - Shares of British telecoms giant BT Group fell almost 3% on Tuesday after an analyst downgraded the stock.
Berenberg cut its rating on the shares from "buy" to "hold" and reduced its corresponding target price from 275 pence to 260 pence.
Its downgrade came after Berenberg noted that BT's normalised free cash flow of almost 2.5 billion pounds is about 1 billion pounds higher than its dividend cost of 1.5 billion pounds.
"From this 1 billion pounds, BT has to support the pension deficit, buy spectrum, buy back employee share options to prevent dilution, and fund restructuring," Berenberg wrote in a note to clients.
The BT share is currently down 2.8% at 221 pence.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Berenberg cut its rating on the shares from "buy" to "hold" and reduced its corresponding target price from 275 pence to 260 pence.
Its downgrade came after Berenberg noted that BT's normalised free cash flow of almost 2.5 billion pounds is about 1 billion pounds higher than its dividend cost of 1.5 billion pounds.
"From this 1 billion pounds, BT has to support the pension deficit, buy spectrum, buy back employee share options to prevent dilution, and fund restructuring," Berenberg wrote in a note to clients.
The BT share is currently down 2.8% at 221 pence.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.