Telstra Corporation Ltd (ASX: TLS) reports its full-year results to the ASX next week. Shareholders are worried…
Is Telstra about to cut its dividend?
Last year, Australia's largest telco revealed that the NBN would leave a hole in its operating profits which could be as big as $3 billion.
That kind of profit does not go unnoticed.
So it's hardly a surprise that over the past year Telstra shares have fallen 27% and more than 37% since their peak in 2015.
Telstra share price
But not only are shareholders feeling a heavy paper loss. The company is expected to cut its yearly dividend payments from its lofty 31 cents per share.
Some analysts suspect the telco will cut its dividend payments to 24 cents per share next week. Others suggest it won't cut the payment until next year.
It would appear that even if Telstra does not cut its dividends next week — it will eventually.
Should you buy Telstra for its dividend?
I have said it before but I think even if Telstra cuts its dividend, its shares will be a buy if they fall significantly below $4. However, as we eagerly await next week's financial report and a lower share price, I'm not in a rush to buy Telstra shares.
