Insights

Is the Telstra (ASX:TLS) share price a good option for income investors?

Good this telco giant be worth considering?
The post Is the Telstra (ASX:TLS) share price a good option for income investors? appeared first on The Motley Fool Australia. –

If you’re an income investor searching for dividend options, then you might want to take a look at Telstra Corporation Ltd (ASX: TLS).

Why Telstra?

This telco giant has been a bit of a nightmare for income investors over the last few years but things are changing rapidly.

This is thanks to the easing NBN headwind and the progress it is making with its T22 strategy. Telstra’s T22 strategy is creating a much leaner business and one which is expected to return to growth in the near future.

In fact, the company’s CEO, Andy Penn, is targeting mid to high single digit operating earnings growth in FY 2022.

Back in February, Mr Penn explained: “I am confident the many initiatives we have taken under our T22 program, particularly in simplifying the business and the digitisation program, will further improve customer experience. To get the real benefits from all the effort we’ve already made, Telstra needs to be bold. I’ve set an aspiration for mid to high single-digit growth in underlying EBITDA in FY22 and $7.5 to $8.5 billion of underlying EBITDA in FY23. I am confident we can deliver this if we remain focused.”

In addition to this, the company is aiming to unlock value by monetising assets and splitting into three separate entities.

Is the Telstra share price good value?

Goldman Sachs is a fan of the company and sees value in the Telstra share price.

The broker currently has a buy rating and $4.00 price target on the company’s shares.

Goldman also continues to forecast the company paying a 16 cents per share fully franked dividend for the foreseeable future.

Based on the current Telstra share price of $3.48, this will mean a very attractive 4.6% dividend yield for investors over the coming years.

These Dividend Stocks Could Be Your Next Cash Kings (FREE REPORT)

Motley Fool Australia’s Dividend experts recently released a brand-new FREE report revealing 3 dividend stocks with JUICY franked dividends that could keep paying you meaty dividends for years to come.

Our team of investors think these 3 dividend stocks should be a ‘must consider’ for any savvy dividend investor. But more importantly, could potentially make Australian investors a heap of passive income.

Don’t miss out! Simply click the link below to grab your free copy and discover these 3 high conviction stocks now.

Returns As of 15th February 2021

More reading

How did the Telstra (ASX:TLS) share price fare in May?
4 ASX 200 blue chip shares analysts rate as buys

Leading brokers name 3 ASX shares to buy today

ASX 200 Weekly Wrap: ASX record highs tumble like… Costa shares

Wake up world, this tech sector is the future: analyst

The post Is the Telstra (ASX:TLS) share price a good option for income investors? appeared first on The Motley Fool Australia.

Important Notice
Trade The US Market With ZERO Brokerage* + FREE Access To Trading Ideas & Value Analysis Tools. Click Here!