BT Share Price (BT.A) Hit’s New High As Bullish Sentiment Continues

BT Group share price (LON: BT.A) has recently achieved a notable milestone, reaching a 52-week high at 191.55p on what has otherwise been a risk-off day in markets. Today's 1% gain is testament to bullish sentiment that has been building, off the back of a series of strategic initiatives.

With BT shares having added 30% since the start of this year, the stock has been a clear outperformer on UK markets. For dividend focused investors, the next final dividend of 5.76p per share will go ex-dividend on August 7, 2025, with payment scheduled for September 10, 2025.

• ~65% share price increase since CEO appointment in February 2024
• Divestiture of non-core assets (BT Italia, Irish operations)
• Creation of standalone international unit (8,000+ employees)
• Fibre network expansion to 18 million premises (6.5M connected)
• 25% year-over-year increase in free cash flow to £1.60 billion

BT's recent performance is underpinned by a strategic refocusing on the UK market, marked by significant divestitures of international assets. The sale of BT Italia to Retelit and the earlier disposal of its Irish wholesale and enterprise division underscore Kirkby's commitment to streamlining operations and concentrating on core domestic activities.

This strategic shift is part of a broader plan to slash costs by £3 billion, increase dividend payouts, and reduce the workforce to between 75,000 and 90,000 by 2030. Since Kirkby's appointment, BT’s share price has climbed 50%, indicating strong investor approval of her vision.

Further demonstrating its strategic realignment, BT has established a new standalone international unit. This division, serving customers in over 180 countries and employing over 8,000 individuals, will operate independently, potentially paving the way for a future sale or merger. This move aims to enhance competitiveness amid increasing pressure from rivals, particularly the merged Vodafone and Three. The carve-out follows a similar pattern of divestitures, further solidifying BT's focus on its core UK operations.

Financially, BT reported a modest 1% increase in core earnings for the fiscal year ended March 31, 2025, reaching £8.21 billion. This growth was primarily driven by strong demand for fibre connections and operational efficiencies. Despite a 2% decline in overall revenue, the company's Openreach division stood out, achieving growth in both revenue and earnings due to its ongoing fibre rollout across Britain.

BT also reported a 25% year-over-year increase in free cash flow to £1.60 billion and reiterated its longer-term targets of £2 billion free cash flow by FY27 and £3 billion by 2030. The FY2025 net profit was £1.05 billion, a 23% year-on-year increase, despite one-off costs of £822 million.

However, BT's path is not without its challenges. CEO Allison Kirkby has indicated that advancements in artificial intelligence (AI) could lead to deeper job cuts than initially planned.

While the company had already announced plans to eliminate over 40,000 jobs and cut £3 billion in costs by 2030, the potential for further reductions through AI-driven efficiencies is now being considered. Kirkby has also suggested that BT may consider spinning off its infrastructure arm, Openreach, once its full-fibre rollout to 25 million homes is completed, an event anticipated next year.

Despite these headwinds, the prevailing sentiment surrounding BT Group remains cautiously optimistic. The company's upward momentum is reflected in its share price crossing above its 200-day moving average, a technical indicator often viewed as a bullish signal.

Looking to analysts, and the average price target of 197.19p indicates a mild perceived upside from the current trading price. Analysts are also anticipating continued earnings improvement in the coming quarters as one-off restructuring costs subside and operational efficiency measures take effect. The adjusted EPS for the most recent quarter was 18.80p, and consensus estimates indicate further moderate growth for the next fiscal cycle.

While challenges persist in the competitive UK broadband market, BT's strategic refocusing and commitment to innovation position it for potential earnings rebound and positive shareholder returns.