Credit Suisse raised its price target for shares in BT Group PLC (LSE:BT.A), which it rates ‘outperform’.
The move follows a presentation by the heads of its Openreach infrastructure business and a management update.
The Swiss investment bank also raised its 2024 free cash flow forecast by 10%.
It said it is 2% ahead of 2024 consensus forecasts for underlying earnings (EBITDA), but it also noted that the consensus for 2023 is around £100mln below the company’s own guidance “in which management has expressed high confidence”.
Billionaire Patrick Drahi’s Altice, which has a 12% stake in BT, will be free to bid for the UK telco after the end of the moratorium on December 10.
Credit Suisse isn’t expecting fireworks, however.
“It is debatable how significant this is (Altice already free to make smaller stake increases, no statements suggesting Altice wants to make a bid for BT),” the bank said.
“The more important point in our view is whether Altice’s presence might accelerate further shareholder-friendly steps; for example, on cash returns or strategy.”
The shares ended the day almost flat at 168p. Credit Suisse thinks they are worth 200p.