Sound the alarm bells!
Telstra Corporation Ltd (ASX: TLS) shares are down another 0.5%…
Telstra's Share Price and Dividend Yield in 2015
Data sourced from Yahoo! Finance.
…queue the bargain buying music
On the plus side, the quicker Telstra's share price falls, the faster its dividend rises!
One look at the above chart proves just how volatile share prices can be. However, it also shows us that the market is currently offering a chance to buy Telstra shares at a dividend yield equivalent to that which it offered us in January!
But it's not like Telstra is a struggling miner which is digging into debt to pay dividends, such as Rio Tinto Limited (ASX: RIO) or BHP Billiton Limited (ASX: BHP).
As anyone who owns a mobile phone will know, Telstra sets its own prices and is a frontrunner in the next wave of telecommunications growth: rising data usage.
In addition to its huge free cash flows, Telstra is set to get a cash windfall from the government's NBN Co for the sale of its 100-year-old copper cable network.
It'll likely put this money to use in Asia where it sees real growth opportunities. However, future increases to the dividend haven't been ruled out.
Personally, I'd like to see prices closer to $5.00 before buying Telstra shares, but even at these prices – and in this low-interest rate environment – it's very appealing.
