Thinking of buying BT shares? Here’s what you need to know
The telecommunication giant’s share price has fallen all the way from around 500p in early 2016 to just 224p today, a decline of 55%, and at present the stock trades on a forward-looking P/E ratio of 8.6 and sports a gigantic dividend yield of 6.9%. However, if you’re considering buying BT shares because they look cheap, there are several things you need to know. Revenue is declining. For starters, BT’s top line is expected to fall this year. For the year ended 31 March 2018, it generated revenue of £23,746m, down from £24,082m the previous year. Analyst downgrades. What’s even more worrying is that City analysts are still downgrading their earnings forecasts for BT. Analysts are becoming more bearish on the group’s dividend prospects, with the consensus dividend estimate for this year having fallen by 0.7p per share over the last three months to 15.2p per share.