LONDON, UK - FEBRUARY 16TH 2018: A close-up view of the historic BT Tower in London, UK, on 16th February 2018.
The BT share price had a relatively good month in November this year. Its stock jumped by about 12% between November 1 and 30th. At its peak, the stock jumped to a high of 171p in November. So, what are the expectations for December?
BT shares will be in the spotlight in December as investors wait for action from Patrick Drahi, the company’s biggest shareholder. Drahi owns about 12% through Altice, his giant telecommunication company.
Drahi has until December 10 when the expiry of a no-bid clause will be triggered. This means that he can announce a full-scale acquisition of the company. BT’s management are aware of this and have moved forward to hire advisors to counter his move.
So far, Drahi has been a relatively silent shareholder, with some analysts calling him a benevolent investor. Still, since he believes that the company is undervalued, there is a likelihood that he will make a move. Besides, the number of acquisitions of UK companies has been rising.
Another reason why interest in BT share price could rise is that KKR proposed a 10 billion euro acquisition of Telecom Italia. Similarly, Deutsche Telekom has recently expressed interest in the company. In September, the company’s CEO promised that something would happen soon.
The daily chart shows that the BT stock price has moved sideways in the past few days. The stock is trading at the same point as the 25-day and 50-day moving averages. It has also moved between the 23.6% and 38.2% Fibonacci retracement level. It has also formed a small inverted head and shoulders pattern.
Therefor, I suspect that the BT share price will bounce back in December as investors target the key resistance at 200p. This view will be invalidated if it drops to about 140p.
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