Will 2018 be better for Telstra Corporation Ltd?

Unfortunately 2017 was a year to forget for Telstra Corporation Ltd (ASX: TLS) and its shareholders.

With just a few trading days left before the end of the year, the telco giant’s shares look set to finish the year with a decline of 28%.

Will 2018 be better?

Whilst nothing is certain, I feel reasonably confident that the worst is now behind the company and shareholders can look forward to a better year.

Firstly, I think its proposed 22 cents per share dividend is safe. There were concerns that NBN ceasing HFC sales for 6 to 9 months would cause a rethink, but if anything the NBN’s decision is a mild positive for the company.

Which is good news because that 22 cents per share works out to be a fully franked 6% yield at the current share price.

Another reason to be bullish on next year is the positive sentiment amongst brokers.

Although not all brokers have buy ratings on its shares, the majority of them do.

And amongst those that are bullish there are price targets of above $4.00 for its shares. These include Morgans, Credit Suisse, and Deutsche Bank.

If Telstra’s shares were to climb above $4.00 again it would mean a potential return of over 9%. Add in the dividend and the total return climbs to 15%.

Foolish Takeaway.

Although Telstra was one of the worst shares you could have owned in 2017, I feel things could be very different in 2018. This could make it worth considering in my opinion.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. 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.

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