The Telstra Corporation Ltd (ASX: TLS) share price is out of form again on Tuesday.
In afternoon trade, the telco giant's shares are down 0.5% to $3.74.
This means the Telstra share price has now dropped almost 7% since this time last month.
Not even news that a major data leak from arch-rival Optus has been able to keep its shares from slipping during recent market volatility.
Is the Telstra share price in the buy zone?
While the recent weakness in the Telstra share price has been disappointing, it could be a buying opportunity based on a recent note out of Morgans.
According to the note, the broker has an add rating and $4.60 price target on the company's shares.
This implies a potential return of 23% for investors over the next 12 months excluding dividends and 27.5% including them.
What did the broker say?
Morgans was impressed with Telstra's performance in FY 2022 and notes that Andrew Penn has left the top job on a high. It said:
Delivering his last result, CEO Andrew Penn exits TLS on a high note. The FY22 result came in at the upper end of guidance (underlying EBITDA +8% YoY), FCF was a beat and TLS raised its dividend (+0.5 cents) for the first time in years.
The good news is that the broker believes Penn has left the company positioned for growth in the coming years. Particularly given how the industry is experiencing some of the biggest tailwinds in years. It explained:
Telco has the strongest tailwinds in a decade with an increasingly rational market, pricing rises and the criticality of telco increasingly recognised. This combines with an incoming CEO who currently seems unlikely to drastically change the business and the potential for value uplift (potential bids) following the legal restructure.
Overall, Morgans appears to believe this could make the Telstra share price great value after recent weakness.
