Why I Think BT Group plc Is A Good Short-Term Play

Recent news flow and developments make me think that BT Group plc (LON: BT.A) is attractive over the short-term.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

For years, Sky has had a stranglehold on subscription television.

Sure, cable (in its various guises) has tried to eat away at this dominance and there was a feeling that Freeview could potentially compete with Sky. However, neither has really made a significant dent into Sky’s dominance and it remains the King of the Castle.

Furthermore, the idea of splitting the rights to Premier League football seemed to be a good one. It would create competition and provide consumers with more choice, since Sky’s dominance of subscription TV seemed to be linked to it being the home of Premier League football.

However, the likes of Setanta Sports and ESPN could do little to dent Sky’s dominance, with the former ending up going bust as a result of the onerous cost of buying the rights to live football.

Now, though, BT (LSE: BT-A) (NYSE: BT.US) seems to be making inroads into Sky’s dominance and, in my view, market sentiment seems to be swinging in its favour.

For instance, it was recently revealed that the first live Premier League match shown exclusively by BT was watched by a peak audience of 764,000. This is a very respectable start to the company’s Premier League journey and, when it is remembered that the match shown was a Saturday lunchtime kick-off, the figure looks even better as Sunday afternoon fixtures tend to draw a bigger audience than Saturday lunchtime matches.

Indeed, viewing figures were ahead of ESPN’s effort from last season, which attracted a peak audience of 713,000 people, and only just shy of the equivalent match shown by Sky last season, which attracted a peak audience of 843,000 viewers. Furthermore, the figures do not include hundreds of thousands of people who watched the game on BT over the internet or via an app.

Such a positive start seems to have been well-received by the market and, with BT shares not looking particularly expensive, I think there is potential for upside.

BT currently trades on a price-to-earnings (P/E) ratio of 12.1, which compares favourably to the FTSE 100 on 15 and the telecommunications industry group on 12.5. If viewing figures continue to be buoyant and are welcomed by the market, then I think it could lead to an upward re-rating of the shares.

Of course, you may be looking outside of the telecommunications sector for an addition to your portfolio. If you are, The Motley Fool has come up with a shortlist of its best ideas called 5 Shares You Can Retire On.

It’s completely free to take a look at the shortlist and I’d recommend you do so. Click here to view those 5 shares.

> Peter does not own shares in BT.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Investing Articles

Google office headquarters
Investing Articles

$1bn a day! This S&P 500 share still looks like a stock market bargain after Q1 earnings

The owner of Google and YouTube just announced strong results to the stock market, including another massive $70bn share buyback.

Read more »

BUY AND HOLD spelled in letters on top of a pile of books. Alongside is a piggy bank in glasses. Buy and hold is a popular long term stock and shares strategy.
Investing Articles

3 cheap FTSE 100 stocks with big dividends to consider buying right now

Sector weakness in some FTSE 100 industries has also left some of my long-term favourite stocks offering attractive dividend yields.

Read more »

Growth Shares

Forecast: £1,000 invested in Rolls-Royce shares could be worth this much by next year

Jon Smith talks through both his opinion and analysts’ forecasts when trying to predict where Rolls-Royce shares could head from…

Read more »

Man putting his card into an ATM machine while his son sits in a stroller beside him.
Investing Articles

£5,000 invested in Lloyds shares 5 years ago is now worth…

The price of Lloyds shares has more than doubled over the past five years. However, our writer’s cautious about the…

Read more »

Investing Articles

Up 58% in a year, the BT share price could be the FTSE 100 target to beat in 2025

The BT share price has been steadily climbing back since newish boss Allison Kirkby came on board. Is the new…

Read more »

Businessman hand stacking money coins with virtual percentage icons
Investing Articles

£10,000 invested in Nvidia stock 5 years ago is now worth…

Even after the Nvidia stock falls of the past couple of months, its five-year performance remains stunning. And it could…

Read more »

artificial intelligence investing algorithms
Investing Articles

I asked ChatGPT for the best UK stocks to buy for my portfolio in the market sell-off. Here’s what it said

When Edward Sheldon asked the generative AI app for the best stocks to buy amid the market pullback, he was…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

Could now be a rewarding moment to buy shares?

Christopher Ruane's looking for shares to buy in a turbulent market. But while he's focused on quality, he's equally interested…

Read more »