The Telstra Corporation Ltd (ASX: TLS) share price could be in bargain territory according to one of Australia's leading broker.
A note out of Deutsche Bank reveals that its analysts have retained their buy rating and increased the price target on the telco giant's shares to $4.05.
Based on its current share price of $3.50, this implies potential upside in the region of 16% excluding dividends.
Factor in the proposed 22 cents per share FY 2018 dividend and there could be a potential return in excess of 22% over the next 12 months for investors that are brave enough to take a chance on the embattled telco company.
Deutsche appears to have been pleased with what it saw at the annual investor day held by Telstra yesterday.
At the event the company reiterated its full-year guidance and pointed to the Internet of Things (IoT) market as a key source of growth for the company over the next five years.
According to the presentation, Telstra expects the IoT market to grow at a compound annual growth rate of 32% per annum between now and 2023. By that point the addressable market will have grown to be worth $6.6 billion per annum.
Should you invest?
While I think its shares could still fall a little bit lower, I do believe they are close to their bottom now and all the negative news flow is out of the way.
This could make it an opportune time to snap up shares. After all, if Deutsche's price target is realised, they could provide investors with market-beating returns over the next 12 months.
