BT share price woes

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Sinbad
Sinbad Posts: 103 Forumite
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in Savings & investments
I have a quantity of BT shares and since they peaked at about 496p in March this year, they have continued to head south.


When they recently fell to 372p (a 25% fall on the 496p figure) I sold half my holding.


With Friday’s closing share price of 367p, I’m thinking of selling the lot to halt further losses.


Curious as to thoughts out there as to where the pricing is heading, especially with Q2 results due on the 27th of this month.
«134567

Comments

  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
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    You only make a loss when you actually sell!

    You really should be buying!.

    Will you start buying them back when they start going up?


    How large a part of your portfolio are they?

    Cheers fj
  • Pincher
    Pincher Posts: 6,552 Forumite
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    Catch a falling razor, eh?

    I bought 12,000 shares at £3.683.

    At 14p dividend per share, that's 3.8% on £3.683.

    If the progressive dividend policy continues, and we get 15.5p dividend next year, that is 4.2% return.

    I have quite a chunk in NS&I making 1%, and £50k in Premium Bond making 1.25%. Guess what, I used up the £1,000 Savings Allowance, what with Regular Savers and such, so the interest I make at 1% will pay 20% TAX! :mad:

    In contrast, I (and so do you) have £5,000 dividend allowance, and then you only pay 7.5% basic rate.

    Conclusion
    =======

    3.8% and 7.5% tax looks bl00dy good to me,
    versus 1% and then 20% tax.


    Also, if it drifts back up to £3.90, it's a 5% quickie.
  • grey_gym_sock
    grey_gym_sock Posts: 4,508 Forumite
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    it's not that big a fall, for an individual company share. if you're not comfortable with it, perhaps you should stick to collective investments in shares?

    i've held BT shares since 2008, and not planning to sell now. i do wonder a bit about the recent EE acquisition, on the grounds that acquisitions generally often go badly.
  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
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    As pincher described, divis are eps usually in p. That means each share pays a certain amount in pence, not a percentage.

    So obviously as the share price falls the divi stays the same thus the yield gets bigger. Simples!

    fj
  • Linton
    Linton Posts: 17,172 Forumite
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    BT is a very large company with a strong position in its market. Why were you holding it in March at 496p? Has the long term outlook changed in 6 months? Perhaps you should have been thinking of buying more at a relatively cheap price rather than selling the shares you hold. Buying high and selling low is a guaranteed one way street to losing your money.

    Holding individual shares is a very high risk strategy unless you have enough money to own 15 at the absolute minimum so that falls in one dont spook you by significantly reducing the value of your total portfolio.

    I have no idea where the price is heading - neither does anyone else. If people knew the price would already be there.
  • tg99
    tg99 Posts: 1,199 Forumite
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    bigfreddiel wrote: »
    As pincher described, divis are eps usually in p. That means each share pays a certain amount in pence, not a percentage.

    So obviously as the share price falls the divi stays the same thus the yield gets bigger. Simples!

    fj

    Not quite so simples if the dividend is cut though (the anticipation of which might be part of the reason a share price is falling though am not taking specifically about BT here).
  • Pincher
    Pincher Posts: 6,552 Forumite
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    Check out the Dividend Cover.

    Earnings of 33.2p, and a dividend of 14p

    33.2p / 14p = 2.37, the dividend cover.

    So they made 33.2p, but only paid out 14p.

    BT "intends" to pay more dividend every year.


    In contrast, RDSB (Royal Dutch Shell B) made 20.19p, but paid out £1.26, making the Dividend cover 0.16. Did the institutional investors gang rape the board of directors? Pay up or red hot poker time?

    BT is far more likely to carry on paying dividend than RDSB, obviously.
  • Sinbad
    Sinbad Posts: 103 Forumite
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    bigfreddiel wrote: »

    How large a part of your portfolio are they?

    Just under 10% of my portfolio. Apart from a 10% holding in Lloyds (that’s another story!), the rest of my portfolio is spread around various UK and Global funds
    Linton wrote: »
    Why were you holding it in March at 496p?

    [FONT=&quot]I was too greedy; I was planning to offload some at 500p. I was hoping they were going to head back up but alas...[/FONT]
  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
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    tg99 wrote: »
    Not quite so simples if the dividend is cut though (the anticipation of which might be part of the reason a share price is falling though am not taking specifically about BT here).

    Well of course everyone knows that, the eps goes down.

    Just don't get stuck on the yield quoted as a percentage
  • $nake_eye$
    $nake_eye$ Posts: 411 Forumite
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    Try hang in there! You only lose out when you sell
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