Why is the Telstra share price lagging the ASX 200 today?

A young man sits on the floor with his back against a sofa hunched over his phone in one hand and his other hand on top of his head as though he is seeing bad news as his face looks sad and anguished.A young man sits on the floor with his back against a sofa hunched over his phone in one hand and his other hand on top of his head as though he is seeing bad news as his face looks sad and anguished.

It’s been a pretty depressing day for the S&P/ASX 200 Index (ASX: XJO) so far this Thursday. At the time of writing, the ASX 200 has slipped by 0.5%, leaving the index at just under 7,220 points. But it’s been even worse for the Telstra Group Ltd (ASX: TLS) share price today.

Telstra shares have had a disappointing showing. The ASX 200 telco has lost a hefty 0.61% of its value over this session thus far, falling from the $4.08 it closed at yesterday to the $4.06 we are currently seeing.

So why is the Telstra share price so on the nose today that the company’s shares are lagging even the ASX 200 Index?

Well, it’s not entirely clear. There has been no fresh news or announcement from Telstra itself today. Or indeed since 7 December.

However, there has been a development that could be impacting investor sentiment towards Telstra today.

The Australian Competition and Consumer Commission (ACCC) has just released its latest NBN Wholesale Market Indicators Report. This quarterly report reveals data surrounding the use of the national broadband network (NBN), which Telstra, along with other telcos, onsells to customers.

The latest report covers the three months to 30 September 2022. It shows that, while Telstra remains the market leader in the provision of fixed-line internet services, its market share has fallen.

Telstra falls

Over the quarter in question, Telstra commanded 42.7% of wholesale NBN market share. The next closest provider was TPG Telecom Ltd (ASX: TPG), with a 22.8% market share. Optus came next with 13.4%, followed by Vocus Group with 6.9%. ‘Others’ made up the remaining 14.2%.

So why is this bad news for Telstra? Well, in the previous report covering the three months to 30 June, Telstra had a 43.3% share, meaning its share of the total market fell 0.6% in just one quarter.

In fact, market share for the largest three providers (Telstra, TPG, and Optus) all fell over the quarter, taken up by smaller providers like Aussie Broadband Ltd (ASX: ABB). The ‘big three’ had a combined market share of 87.4% in the June quarter, but this fell to 85.8% for the September quarter.

Not exactly inspiring stuff for Telstra and its investors.

So this could be what is dragging on the Telstra share price this Thursday. It’s a bit of a dampener for Telstra shares, which have enjoyed a very solid month, rising more than 4.5% since mid-November:

Telstra shares remain down by around 4% year to date. At the current Telstra share price of $4.06, the ASX 200 telco has a (wildly coincidental) trailing dividend yield of 4.06%.

The post Why is the Telstra share price lagging the ASX 200 today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Telstra Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Aussie Broadband. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Aussie Broadband and Tpg Telecom. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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