Insights

Why the Telstra (ASX:TLS) share price has had a top week

The Telstra (ASX: TLS) share price is having a good week so far. Here’s why the ASX’s largest telco might be in demand.
The post Why the Telstra (ASX:TLS) share price has had a top week appeared first on The Motley Fool Australia. –

A happy woman looks at her mobile phone and fist pumps, indicating a share price rise

The Telstra Corporation Ltd (ASX: TLS) share price has had a great week this week so far (touch wood). Today, Telstra shares opened at $3.17 a share and are trading up 0.78% to $3.22 a share at the time of writing.

But the Telstra share price actually closed last week at $3.07 a share. That means the ASX’s largest telco is up more than 4.7% over this week so far. Sure Telstra’s still not anywhere close to its old ‘glory days’ pricing of $6-plus a share. It’s not even back up to near its 52-week high of $3.54.

But a 4.7% increase is a 4.7% increase – a pretty decent bump in a week for an old ASX blue chip like Telstra.

So why has this company suddenly found some appeal on the ASX this week?

Telstra share price on the rise

Well, it’s not because we’ve heard anything from the telco this week. Or for a while, in fact. Telstra’s last market announcement was back on 9 March. That was a routine dividend announcement regarding the upcoming payout Telstra’s shareholders will be receiving on 26 March. Like all of its recent payouts, this dividend will consist of an ordinary dividend of 5 cents a share and a special dividend of 3 cents.

But speaking of dividends, we might have found the reason why investors are taking a second look. This week has seen even more investors fleeing the ASX tech sector. The catalyst was once again rising bond yields, which have really spooked investors today, as a matter of fact.

And that might be the answer to why investors are seeking out the Telstra share price. Rising bond yields reduce the appeal of companies that have yet to deliver positive cash flows but promise to down the road. That mostly applies to the tech sector.

But they also highlight the appeal of shares that offer substantial cash flows today. No one buys Telstra or other blue chips like National Australia Bank Ltd (ASX: NAB) for their massive future growth runways. Things like profitability and dividends tend to be far more relevant for the investor seeking these companies out. That probably explains why Telstra and NAB shares are both in the green today, while tech shares like Afterpay Ltd (ASX: APT) are bleeding heavily.

And the Telstra share price is particularly attractive in this regard. Its 16 cents per share dividend would equate to a market-leading yield of 5% today (or 7.14% grossed-up with full franking).

Sometimes, just going back to the basics can explain what the share market is doing.

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.

Click Here For Your Free Stock Report

Returns As of 15th February 2021

More reading

Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited and Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Telstra (ASX:TLS) share price has had a top week appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!