The Motley Fool

Why investors should love updates from BT Group plc and SABMiller plc

Investors would normally be forgiven for paying little attention to communications regulator Ofcom, but shareholders of BT Group (LSE: BT) should be ecstatic at today’s long-awaited release of the report on the future of Openreach, the subsidiary that controls the vast majority of physical broadband infrastructure in the UK. On the face of it, Ofcom forcing BT to make Openreach a legally separate company within the group with its own board of directors and budget control could be viewed as disastrous. But it’s a mere slap on the wrist compared to some of the more draconian options put forward.

The most extreme route would have been to spin out Openreach from BT altogether, something that many competitors and MPs had called for as a means of lowering broadband costs and expanding coverage across the country. The fact that Ofcom didn’t take this approach, at least for the time being, is critical to BT as Openreach provided a full 40% of group EBITDA last year.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Losing this cash cow completely would have been an immense blow for BT because it’s currently investing heavily in making itself a major player in the media industry. The company has spent billions of pounds on television rights for certain Premier League and Champions League matches as well as buying EE for £12.5bn.

Now that Ofcom has allowed BT to maintain a degree of control over Openreach, the company can continue to use these profits to fund its plan to compete with Sky for high-margin quad-play broadband, TV, mobile and landline packages. Whether this will work out for BT is a bigger question, but investors should breathe a sigh of relief for now that Ofcom didn’t throw a spanner in the works.

Extra cash

SABMiller (LSE: SAB) shareholders woke up to great news this morning as AB InBev upped its offer for the South African brewer to £79bn. While this increased offer only partly compensates for the plummeting value of the pound, no one will scoff at extra cash for a deal that was struck all the way back in November.

As the deal marches towards completion, having gained regulatory approval in the EU and US among other major markets, the biggest question facing investors will be whether to take the £45 cash per share option or the cash and stock alternative. It will be now be worth around £51 if SAB Miller’s board okays the latest offer.

Ab InBev has been a solid performer over the past decade as it gobbled up a slew of household names, cut operating costs and expanded exposure to emerging markets but it remains to be seen whether SAB Miller will offer as many synergies as expected or what price it will receive for regulator-mandated sales of certain operations. Either way, investors should be happy that they’ll have a few extra pounds in their pocket if the deal closes.

“This Stock Could Be Like Buying Amazon in 1997”

I'm sure you'll agree that's quite the statement from Motley Fool Co-Founder Tom Gardner.

But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.

What's more, we firmly believe there's still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.

And right now, we're giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool.

Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge!

Ian Pierce has no position in any shares mentioned. The Motley Fool UK has recommended Sky. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Where to invest £1,000 right now

Renowned stock-picker Mark Rogers and his select team of expert analysts at The Motley Fool UK have just revealed 6 "Best Buy" shares that they believe UK investors should consider buying NOW.

So if you’re looking for more top stock ideas to try and best position your portfolio in this market, then I have some good news for your today -- because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.