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2 huge reasons you should own Telstra Corporation Ltd shares

Telstra Corporation Ltd (ASX: TLS) has seen the writing on the wall…

…and it says: “Go big, go overseas and dominate data management”. That’s exactly what it’s doing.

Welcome to the modern age and the new version of Telstra. The telecom giant sees its greatest growth coming from data management and being involved in the use of the “internet of everything”.

Here are two big trends that Telstra sees as driving future growth.

— E-health

Want to stay fit and monitor your health? There’s an app for that. Telstra is developing an e-health business division that will work with healthcare providers to monitor and manage patients’ health and wellbeing. It plans to invest $100 million in its new Telstra Health and recently entered a joint venture with a Swiss healthcare management company to offer over-the-phone consultation services for general practitioners.

Telstra already has 10 health related companies in the division and expects it to be one of the fastest growing divisions of the company.

—  Data storage and cloud services

The company is constructing data centres which will handle the enormous amount of information that is generated each and every day by businesses and consumers. Its new one in Melbourne is already working with the intercloud networks being developed along with big names like Cisco Systems, Inc (NASDAQ: CSCO).

Telstra sees business enterprise services as the next big wave for information management. It wants to be a big player in Asia as the region’s economies are growing and urbanising. It can use its technical know-how to act as a consulting agency for telecom development.

The company has extra billions to fund these growth projects. Also, it is in negotiations for the turnover of the phone copper network infrastructure for the national broadband network rollout. That’s expected to give the company about $11 billion.

It will take time and money to build this, but I think long-term investors can benefit from this ambitious expansion plan by building up a position as it progresses and enjoy its rock-solid 5.1% fully franked dividend yield along the way.

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Motley Fool contributor Darryl Daté-Shappard does not own shares in any company mentioned. 

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