The Telstra Corporation Ltd (ASX: TLS) share price is edging lower on Wednesday amid a broad market selloff.
At the time of writing, the telco giant’s shares are down 0.5% to $3.91.
This is actually better than the market as a whole, which may be due to the release of a shareholder presentation today.
What did Telstra release?
This morning Telstra is holding its retail shareholder event and has released its accompanying presentation.
The telco giant used the presentation to reiterate its T25 plans, which include bold growth targets in the coming years.
For example, the company is aiming to grow its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) by a mid-single digit compound annual growth rate (CAGR) between FY 2021 and FY 2025.
Things are even better for its underlying earnings per share, with management targeting a high-teens CAGR for the same period.
Another focus for Telstra will be its dividend. Management advised that it intends to maximise its full franked dividend and seek growth over time.
Some of this growth will be underpinned by management’s cost cutting plans. It is seeking to remove a further $500 million of fixed costs from FY 2023 to FY 2025. Though, it stresses that this won’t be at the expense of investments in growth.
Is the Telstra share price in the buy zone?
One leading broker that sees a lot of value in the Telstra share price is Goldman Sachs.
A recent note out of the investment bank reveals that its analysts have a buy rating and $4.40 price target on its shares.
Based on the current Telstra share price, this implies potential upside of 12.5% or 16.5% if you include the forecast fully franked 16 cents per share dividend.
Goldman was pleased with Telstra’s T25 plans. It is expecting the plans to underpin solid earnings and dividend growth in the future.
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- 2 ASX dividend shares with attractive 4%+ yields
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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