The Telstra Corporation Ltd (ASX: TLS) share price dropped into the red on Thursday. This followed the release of the companyâs full year results for FY 2022.
The telco giantâs shares ended the day down by 1.25% to $3.96.
What did analysts say about the result?
Telstra delivered a result that was largely in line with the marketâs expectations and its final dividend increase to 8.5 cents per share was a big (pleasant) surprise.
In light of this, the weakness in the Telstra share price appears to have been driven by its guidance for FY 2023.
Telstra has guided to EBITDA growth of 7.5% to 10% in FY 2023, which wasnât quite as strong as analysts at Goldman Sachs were expecting.
The broker has commented:
Telstra reported FY22 EBITDA/EPS that were +1%/+9% vs. GSe, but in-line excl. $116mn of legacy network disposals. Lower Digicel & NBN one-off earnings expectations resulted in FY23 EBITDA guidance -1% vs. GSe prior. T25 targets were mostly re-iterated, except for returning D&IP to growth in FY24E (with the inter-capital fibre build being more IRU/cash focused). However, the key surprise was the 8.5¢ final dividend (GSe 8.0¢).
Is the Telstra share price good value?
While Goldman sees value in the Telstra share price, it doesnât see enough to recommend it as a buy just yet.
According to the note, the broker has retained its neutral rating and $4.40 price target on the companyâs shares. Based on the current Telstra share price, this implies potential upside of 11% for investors.
But thatâs not including dividends. Goldman is forecasting a 17 cents per share fully franked dividend in FY 2023, which would mean a 4.3% yield. This would stretch the total return on offer with its shares to over 15%. Not bad for neutral!
The post Is the Telstra share price a buy after the telco’s FY22 results? appeared first on The Motley Fool Australia.
Should you invest $1,000 in Telstra Corporation Ltd right now?
Before you consider Telstra Corporation Ltd, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Telstra Corporation Ltd wasn’t one of them.
The online investing service heâs run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
See The 5 Stocks
*Returns as of August 4 2022
(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}
setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()
More reading
- Why AMP, OFX, Rio Tinto, and Telstra shares are dropping
- Equity markets threaten to ‘melt up’ as Nasdaq enters bull market territory
- Everything you need to know about the latest Telstra dividend
- Telstra share price higher on earnings beat and surprise dividend increase
- Telstra share price on watch amid strong FY22 result and surprise dividend increase
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 has positions in 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 Scott Phillips.
from The Motley Fool Australia https://ift.tt/ejb7sEg
Leave a Reply