The five-year picture for BT Group (LSE: BT.A) shares shows almost no overall movement — just a 0.5% gain. But looking deeper, it really has been a period of two halves. BT shares were on a slide until that famous moment in 2024, when CEO Allison Kirkby said the company had “passed peak capex on our full-fibre broadband rollout and achieved our £3 billion cost and service transformation programme a year ahead of schedule.”
But if we can still buy BT shares around where they were five years ago, is this an opportunity not to be missed?
Our record-breaking Openreach full fibre build hit its upgraded target and today reaches more than two-thirds of UK homes and businesses, keeping us well on track for our 25 million milestone by the end of December. We extended our mobile leadership further, with EE winning best mobile network in three separate awards, bringing 5G+ to 73% of the population.
— Allison Kirkby, FY 2026 results
The recent share price reversal kicked in just before May’s full-year results, so let’s remind ourselves of a few highlights….
- Record FTTP build reached 4.8m premises in the year.
- Record customer demand for Openreach FTTP saw 2.2m net additions.
- BT achieved £580m gross annualised cost savings during FY26.
- EE remains the UK’s best mobile network.
That final point might be a bit subjective. But BT says a number of independent industry assessments support it.
All about the cash
We can’t hide from one key thing. Investing in BT shares is mostly about the dividend.
Dividends need cash. And cash is greatly helped by lowering costs. To that end, in this latest report BT spoke of an “overall transformation plan target raised to £3.7bn from £3bn and extending the programme by one year to FY30, at a cost to achieve of £1.4bn from £1bn.”
And on the dividend itself, the update revealed an “updated dividend policy to grow the dividend by low-to-mid-single-digit percent per annum in FY27 and onwards until metrics consistent with a BBB+ credit rating are reached; thereafter residual cash flow will be available for enhanced distributions to shareholders.“
Management, it seems, is firmly behind BT’s longstanding policy of prioritising dividends.
So why not buy?
BT shares are on an undemanding forward price-to-earnings (P/E) ratio of 14.5. And it would drop to 13.3 based on forecasts out to 2029. The dividend yield is modest at 4.1%, but still pretty respectable — and we have those bold dividend plans. So the question has to be why shouldn’t we buy at today’s price?
The answer for me is relatively straightforward — BT’s net debt has reached £20bn. That matches the company’s entire market cap. And it makes those P/E valuations largely meaningless. So I’m out, essentially because I have a rule to not invest in heavily indebted companies.
But for those who can put that aside and just keep taking the dividends, BT must be worthy of consideration.
Should you invest £5,000 in Bt Group Plc right now?
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Alan Oscroft does not hold any positions in the companies mentioned.
