Should you buy Telstra Corporation Ltd?

Shares in Telstra Corporation Ltd (ASX: TLS) have performed very well for investors over the past two years, with a total return of 52%. Not bad when you consider the S&P/ASX 200 Index (ASX: XJO) (INDEXASX: XJO) is up around 32%.

But with its stock price sitting at fresh 10-year highs, potential investors and current shareholders have to ask themselves whether now is the time to buy or if it is a good time to sell.

Big dividends are in demand

As we’ve seen in recent times, company’s who pay big dividends have had their share prices bolstered by the low interest rate environment. Telstra, with its legendary 28 cent fully franked dividend, is no exception.

However, Telstra has more to offer than a juicy fully franked dividend payment.

With local dominance in mobiles, fixed internet, pay TV and more, Telstra recently announced it will push further into growing Asian markets. CEO David Thodey said his company has set a goal of deriving one third of revenues from Asia by 2020. Whilst risks persist, its move could unlock significant potential for long-term investors.

Buy, Hold or Sell?

With a solid domestic base, from which it’ll leverage its growth strategy, Telstra appears to be positioned for overseas success. However, Telstra’s local dominance and overseas growth prospects are now baked into its share price and it is no longer a bargain long-term investment. As such I rate Telstra as a hold.

But Telstra isn't the only big dividend stock available on the ASX. In fact, our top analyst recently identified one cheap and growing small-cap ASX stock with a 7% grossed-up dividend yield which I'm strongly considering buying today. And I think you should too! He dubbed it, "The Motley Fool's Top Dividend Stock For 2014 - 2015". Best of all: You can get the name and code of this ultra-promising stock for free! Just click here to download your free copy of "The Motley Fool's Top Dividend Stock for 2014-2015" today.

Motley Fool Contributor Owen Raszkiewicz does not have a financial interest in any of the companies mentioned. 

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