Key Takeaways
- BT remains on track for its 2026 targets despite lacklustre Q2 results.
- Cost control, and limiting the extent of “line losses” are key factors in the quality of its results, Morningstar’s analyst says.
- BT’s short-term future looks reasonably positive, and shares are attractively valued at around £2.
Ollie Smith: Telecoms giant BT Group BT.A is putting a positive spin on flat results. But what do the latest numbers mean for the BT share price, and is BT stock still worth considering?
In its Q2 trading update, chief executive Allison Kirkby told investors that the company had achieved “record” new full-fibre connections and take-up, with fibre itself contributing to more than half of the company’s broadband revenues for the first time.
That was just about the only bit of stand-out news. Elsewhere, BT’s results were uninspiring, and investors know it. The BT share price is down 2.65% over the past six months. Year to date, things are somewhat brighter, with BT stock up 11.76% since January. For now, this positions BT for its best annual gain since last year, when its stock climbed 27.77%.
What Q2 Results Mean for the BT Share Price
In its most recent Q2 results, BT delivered flat year-on-year adjusted revenue growth and a 1% decline in adjusted EBITDA.
Openreach, the fixed-line wholesale infrastructure historically relied upon by both traditional copper broadband and full-fibre broadband customers, is enduring “line losses” as its customers either convert away from copper onto BT full-fibre or get the latest technology from one of its competitors—like Sky, Virgin Media, or TalkTalk.
BT says line losses hit 192,000 in Q2, and that the number will likely reach 800,000 by year-end. Investors are watching that number closely, given what it could mean for BT stock.
Morningstar senior equity analyst Javier Correonero says any signs of lower-than-expected line losses could raise Openreach revenue and EBITDA beyond market expectations. Trends could still swing “meaningfully” either way, he cautions, a sign of the competitive marketplace BT is operating in.
That’s just one of the reasons BT does not earn a Morningstar economic moat rating. Another is its relationship with regulator Ofcom. It’s currently good, but that could change.
Is BT Stock a Buy in 2026?
So, is BT stock a buy at its current share price? BT shares are currently trading around the £2 mark—well below Morningstar’s fair value estimate of £2.30.
That makes it an undervalued four-star stock during what will be a crucial quarter for the company. Cost control remains “paramount”, Correonero says, and if short-term movements in the broader telecoms market play in BT’s favor, the company could well end the year on the up.
The longer-term view? Well, it’s difficult to put too much of a positive spin on that. In the competitive world of telecommunications, BT still has much to prove.
For Morningstar, I’m Ollie Smith.
