Next week the Telstra Corporation Ltd (ASX: TLS) share price will be in focus.
That’s because on Thursday, the telco giant is due to release its full year results.
What is the market expecting from Telstra’s results?
According to a note out of Goldman Sachs, its analysts are expecting Telstra to deliver full year underlying EBITDA of $7.1 billion.
This is a touch short of the market consensus estimate of $7.2 billion, but in line with Telstra’s guidance range of $7 billion to $7.3 billion.
On an earnings per share basis, the broker has pencilled in earnings of 14.4 cents per share.
Goldman is expecting the company to maintain its final dividend at 8 cents per share despite its strong free cash flow generation. This will mean a 16 cents per share fully franked dividend again in FY 2022. Though, it may not be long until dividend increases start to happen according to its analysts.
We believe TLS will pay an 8c final dividend despite its strong cash flows, as it remains franking constrained. We also now forecast a 17c/18c dividend in FY23/24E, but consistent with history, we do not expect TLS will provide any forward looking commentary on its dividend at this result. With its legal restructure to be completed by end of Oct-22 (post scheme meeting) we also do not expect any updates on potential InfraCo-Fixed monetisation.
The broker is expecting Telstra to provide the market with guidance for FY 2023. Particularly given that it has previously provided an aspirational target of EBITDA of $7.5 billion to $8 billion in FY 2023.
We expect all of our coverage will provide forward-looking guidance, noting that TLS previously outlined aspirations for $7.5 to 8.0bn of EBITDA (ex-Digicel) in FY23 – broadly consistent with our revised $7.58bn ex-Digicel.