The brakes on BT Group PLC's (LSE:BT.A) recent strong run were applied by analysts at Citi on Friday, who cautioned of "a quiet watershed coming" at the telecoms group's first-quarter results next Thursday, 24 July.
Openreach, the FTSE 100 group's infrastructure arm, will enter a decline in the trading update, the bank's analysts predict.
"As such, on one of the busiest reporting days of the year, it may go somewhat under the radar for many investors.
"However, we think that Q1 represents a watershed moment for the investment case."
Citi analyst Carl Murdock-Smith forecast that not only will Openreach revenue turn negative in Q1 for the first time since 2019, but it will "stay in decline for the rest of the decade".
He made no change to his 130p target price and maintained a 'sell' rating, first applied in February, though since the start of the year BT's shares have climbed roughly a third from 140p to around 200p.
Citi is not the only bank with such a rating on BT, with UBS also negative due tp caution over the sustained pressure Britain’s incumbent telecoms operator is facing from alternative network operators – aka ‘altnets’ – in the UK broadband market, which the FT this week called "tiny barbarians gather at BT’s gate".
These smaller but more nimble rivals, including CityFibre, Hyperoptic, Community Fibre, Gigaclear, Netomnia, and Trooli, have reached 16.4 million premises at the end of last year, according to the Independent Networks Cooperative Association.
BT shares were down less than half a penny at 197.7p on Friday.