Broker snap: Morgan Stanley cautious ahead of BT's results

29th Apr 2013 10:53

Morgan Stanley has reiterated its 'equal weight' rating and 300p target price for telecoms giant BT, saying it remains cautious ahead of firm's full-year results on May 10th.The broker expects group revenue to fall by 6.2% from £19,307m to £18,110m in the year to end March, while reported profit before tax is estimated to edge higher from £2,445m to £2,485m.Morgan Stanley downgraded its recommendation for the stock earlier this month due to near-£200m per annum of headwinds from recent Ofcom decisions and rising pension liabilities due to lower real yields, in addition to ongoing "calls & lines" losses.Shares have re-rated strongly over the past year and upside to its target pice is now more limited, the broker said on Monday morning.The stock is "not so cheap", trading at 12.6 times earnings (on estimates for year ending March 2014).The stock was down 0.38% at 284.7p by 10:51.BC