Telstra Is Back In The Buyzone

Shares of Telstra have been under pressure for the last 12 months and posted an 8-year low of $3.08 in early trade today.

Investors’ concerns over the telco giant’s profitability and decision to cut its dividend have been the driving forcesa in the share’s decline.

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We remain upbeat on the TLS’s prospects and expect market sentiment will soon become positive.

It’s reasonable to expect that the Federal Government will decide to write down the value of the NBN, which will lead to higher margins for TLS.

This would make its 22 cents per share dividend secure over the longer-term.

At the current share price, that pencils out to a fully-franked yield of 7%.


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