With more than one million shareholders on the books, Telstra Corporation Ltd (ASX: TLS) is the most widely held ASX-listed share. But with the Telstra share price underperforming the S&P/ASX 200 Index (ASX: XJO) so far this year, is it the place to be?
Given the changes at the telecom giant, analysts and experts could be readjusting their expectations for the Aussie network provider. For investors, the main query is: does this mark the beginning of a sustained return to growth?
Let's recap what a few experts think could be ahead for the company and the Telstra share price.
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Leading with expansion after years of reduction
The end of an era is nigh following an announcement on 30 March that CEO Andrew Penn will be resigning. During his seven-year service at the helm, Penn led the radical overhaul of Telstra with the initiation of the T22 strategy.
Since its introduction in June 2018, Telstra has managed to shave off $2.5 billion in costs and return to underlying growth. During this time, the Telstra share price has appreciated by approximately 50%. Now that the full extent of the T22 strategy has been delivered, the blue-chip ASX share is moving forward with growth.
From 1 September 2022, Vicki Brady will take the reins and aspire to push forward with the new T25 strategy. In contrast, this new roadmap is geared towards expanding Telstra's horizons once again. Some objectives of the T25 strategy include:
- Create sustained growth and value for shareholders
- Provide an exceptional customer experience
- Provide a leading network and technology solutions
Based on the actions taken recently, it appears Telstra is already looking to make headway on these goals. For instance, the unlikely partnership between TPG Telecom Ltd (ASX: TPG) and Telstra that was revealed in February. This will see the $47 billion telecom giant gain access to more spectrum in regional Australia.
Another play for growth includes the acquisition of Digicel Pacific, adding 2.5 million customers across Papua New Guinea, Fiji, Samoa, and other countries in the region.
Could it be green days ahead for the Telstra share price?
At the moment, many analysts are fond of the growth potential ahead for Telstra. The company itself is aiming for compound annual growth in the high teens for its underlying earnings per share (EPS) out to FY25.
In light of this, several brokers are currently holding buy ratings on the Telstra share price. Ord Minnett, Credit Suisse, and Morgans are expecting $4.50, $4.50, and $4.56 per share, respectively.
However, Morgan Stanley holds an even more bullish price target at $4.60. This would suggest a potential 14% upside to the Telstra share price.
