One of the most popular options for income investors on the Australian share market is the Telstra Group Ltd (ASX: TLS) dividend.
This is for good reason. Over the last couple of decades, the telco giant has paid billions of dollars out to shareholders in the form of dividends.
In light of this, investors may be wondering what lies ahead for Telstra shares and their dividends.
What is the market expecting from Telstra shares?
Given the surprise dividend increase to 16.5 cents per share in FY 2022 and its new growth-focused T25 strategy, there's a lot of different opinions on what Telstra shares will yield in the near term.
But the good news is that nobody is forecasting a dividend cut. The worst possible outcome for income investors, according to analysts, is a flat dividend.
For example, a note out of Goldman Sachs reveals that its analysts expect fully franked dividends per share of 17 cents in FY 2023 and 18 cents in FY 2024. Based on the current Telstra share price of $4.15, this will mean yields of 4.1% and 4.3%, respectively.
And while Goldman only has a neutral rating on its shares, it does believe they could rise to its $4.40 price target.
Over at Morgan Stanley, its analysts are forecasting the same as Goldman. However, they have an overweight rating and $4.75 price target, which suggests that Telstra shares could rise almost 15% over the next 12 months.
Across at Ord Minnett, its analysts are expecting stronger dividend growth. They are forecasting a 17 cents per share dividend this year and then a 19 cents per share dividend in FY 2024. This would mean a yield of 4.1% and 4.6%, respectively.
Ord Minnett also sees decent upside ahead for the Telstra share price. It has a buy rating and $4.70 price target.
Finally, Morgans isn't expecting any dividend growth from Telstra in the near term. It is predicting that Telstra will continue to pay 16.5 cents per share dividends in both FY 2023 and FY 2024, providing 4% yields. It has an add rating and $4.65 price target.
Overall, anyone buying Telstra shares today should expect to receive a dividend yield of 4% or above in FY 2023 and FY 2024.
