Over the past few years the Telstra Corporation Ltd (ASX: TLS) share price has thoroughly underperformed the rest of the market.
Pleasingly for its long-suffering shareholders, 2019 has started very positively and the telco giant is on course to be a market beater.
Although its shares dropped around 1% lower on Monday, they are still up almost 13% since the start of the year.
As a comparison, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is up a solid 9.5% since the turn of the year.
Has the Telstra share price peaked?
According to analysts at Goldman Sachs, there could still be meaningful upside for its shares in 2019.
A note out of the investment bank of Friday reveals that its analysts have held firm with their conviction buy rating and $3.70 price target. This price target implies potential upside of over 15% excluding dividends.
Goldman remained bullish on Telstra after hosting an investor briefing with Telstra CEO Andrew Penn and members of the senior management team.
The broker appeared to be happy with what management had to say on its future outlook, particularly with its confidence in its ability to lead on 5G.
Telstra is expecting to be the leader in 5G in Australia due to its single vendor network design, the progress it has made in rolling out 5G enabled base stations, and its exclusive access to 5G enabled handsets.
In respect to the latter, this includes the Samsung Galaxy S10 5G which is expected to launch in June. Goldman believes this exclusivity is likely to be very supportive of postpaid subscriber growth in the second half and the first half of FY 2020.
In addition to this, the broker has previously stated its belief that Telstra's stronger than expected first half means it is well positioned to achieve the top end of its underlying FY 2019 EBITDA guidance. Which is something that is likely to go down well with the market.
This is expected to allow Telstra to pay a full year dividend of 16 cents per share fully franked, which equates to a 5% yield at current prices.
Should you invest?
Whilst I think that Telstra is the best option in the telco space ahead of the likes of Amaysim Australia Ltd (ASX: AYS), TPG Telecom Ltd (ASX: TPM), Vocus Group Ltd (ASX: VOC), I'm not a buyer just yet due to the tough trading conditions being experienced in the industry.
