Lots of reasons to stay bullish at BT, says Oriel

13th Jun 2014 12:29

BT Group is a growth stock but is still far from being valued as such, according to Oriel Seurities which kept a 'buy' rating for the telecoms giant on Friday.The broker hailed BT's cash generation abilities and said it expects free cash flow (FCF) to increase at a compound annual growth rate of 9% over the next three years, with risk "on the upside"."More of BT's divisions are set to grow FCF because of continuing cost cutting, less strict price regulation, BT Sport, and the imminent launch of fixed/mobile bundles for UK businesses," said Analyst John Karidis.He said that there are "still lots of reasons to stay bullish".Oriel has a 530p target price for the stock, representing upside from the 394.72p price it was at by 12:37 on Friday, down 0.7% on the day.BC