The BT (LSE: BT.A) share price has been heading higher this year. I think that trend will continue in June as the company pushes ahead with its restructuring plans.
Indeed, there are two developments the market should hear more about over the next few weeks that could lead to improved sentiment towards the company and its stock.
BT share price outlook
The telecoms giant is currently in the middle of an aggressive restructuring programme. It is cutting costs, selling assets and investing more in critical infrastructure assets such as fibre broadband.
As part of this ambitious plan, the group is looking for a partner for its sports business. This division has been a blessing and a curse for the company since its founding.
It was initially established to help the company take on Sky in the pay-TV market. BT Sport helped the group achieve this aim, but it came at a cost. The firm had to spend billions to keep football broadcasting rights and attract customers. I think this distracted management and diverted funds away from where they were needed elsewhere in the business.
We don’t know if BT will sell a share of the division or divest it entirely. Whichever course the company decides to take, it will free up funds.
This could be a net positive for the BT share price. We should find out more about a potential deal in the next few months.
BT is also looking for partners to help with its fibre broadband rollout. The firm plans to connect 25m homes by 2026 at a potential cost of £15bn.
To help fund the buildout, management is looking for a joint venture partner. The company expects to conclude talks with potential partners by September over the terms of a deal, and more details on a possible agreement could emerge in the next few weeks.
Nothing is guaranteed
I think any news on other of the above deals could send the BT share price higher in June. However, there’s no guarantee the company will issue any updates.
In fact, there’s a risk the company’s potential deals may fall apart. That would be very bad news for the business, especially as BT may struggle to fund its spending projects without funding partners.
The firm has a considerable amount of debt already, and borrowing more may put its balance sheet under too much stress.
Despite these risks and challenges, I would buy the stock for my portfolio today. I think BT’s outlook is improving in general, and no matter what happens at the company over the next few months, I think its long-term outlook is encouraging.
Management’s commitment to spend more on infrastructure could stop the customer exodus. Meanwhile, an increasingly digitised economy may only increase demand for the company’s services.
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Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.