MENU

Why the Telstra Corporation Ltd share price has been smacked today

Source: Telstra presentation

The Telstra Corporation Ltd (ASX: TLS) share price has been absolutely hammered today on news that TPG Telecom Ltd (ASX: TPM) is set to enter the mobile sector.

If you own Telstra shares, you may want to look away now…

Source: Google Finance

The Telstra share price dropped as much as 7.2% this morning – the most in three years – to a low of $4.23. It has since rebounded marginally to trade 6.4% lower at $4.27, but that will come as little consolation to shareholders.

Telstra is by and large Australia’s dominant telco, ahead of Vodafone and Optus. The entry of a fourth major mobile operator, being TPG, could see customers leave those established networks in favour of the new one. The additional competition could also force prices to drop, which would do no favours for Telstra’s bottom line.

There are already concerns regarding Telstra’s ability to continue growing profits and to increase – or even maintain – its dividend, so it’s hardly surprising to see the group’s share price fall so sharply following today’s news.

For Investors Who Are Anxious About 2017

In 2017, the share market could have its most volatile year ever. That's why one Foolish expert is revealing 5 of his favorite dividend payers now. These "strong and steady" shares promise a healthy stream of income plus capital gains...

But you must act now. This newly updated report is available for a limited time only, and your copy is 100% free. So don't miss out!

Simply click here to receive your free copy of "Our Top 5 ASX Dividend Shares to Earn You Money in 2017" right now.

Motley Fool contributor Ryan Newman has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

HOT OFF THE PRESSES: My #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.