Telstra (ASX:TLS) share price lifts off after dividend announcement

With interest rates remaining at historic lows, dividend yields are in the spotlight.

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The Telstra Corporation Ltd (ASX: TLS) share price is moving higher this morning, up 3%.

This comes following the release of the ASX telco's full year results for the 2021 financial year (FY21).

We recap a few highlights below.

hand on touch screen lit up by a share price chart moving higher

Image source: Getty Images

What dividend payment did Telstra announce?

Telstra shares could be getting a boost today after the company reported it will pay a final dividend of 8 cents per share, fully franked.

That brings Telstra's full year dividend to 16 cents per share.

At the current price of $3.94 per share, that works out to a trailing dividend yield of 4.06%.

Bearing in mind that this comes with tax credits at the company's corporate rate, and that term deposits in Australia are paying in the range of 1% without tax credits, income investors could be helping push the Telstra share price today.

What else did the results reveal?

For the Motley Fool's detailed coverage of Telstra's FY21 results, you can follow the link up towards the top.

We'll just quickly recap 2 key takeaways here that also look to be boosting Telstra's share price in early trade.

First, while underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) fell 9.7% to $6.7 billion, this was right within the company's guidance of $6.6–6.9 billion.

While falling earnings aren't the most welcome of news, investors tend to reward companies that achieve guidance.

Second, Telstra announced a $1.35 billion on-market share buyback. When a company repurchases its shares, existing shareholders often benefit.

Telstra share price snapshot

Over the past 12 months, Telstra is up 16%, trailing the 24% gains posted by S&P/ASX 200 Index (ASX: XJO).

Year-to-date, Telstra's share price has outperformed the benchmark, up 31% in 2021.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Corporation Limited. 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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