BT results provide investors with confidence

As BT reports full year results, Sheridan Admans, investment research manager at The Share Centre, explains what they mean for investors.

"BT results announced this morning should provide investors with some confidence as looking ahead, dividends are expected to grow at around 10-15% per year for the next three years. The company has also committed to a £300m share buyback programme in 2013.

"The company has once again delivered on strong cost controls pushing free cash flow and adjusted earnings per share above market expectations. However, in its fourth quarter revenue was slightly below consensus reflecting some weakness in its Global Services operations.   

"BT's forward P/E looks undemanding for a fairly defensive regulated utility, cash flow generation looks strong and the yield is attractive for income seekers. We are continuing to recommend BT as a ‘buy' as the business maintains appeal for both growth and income investors."