The Telstra Group Ltd (ASX: TLS) share price is pushing higher again on Thursday.
This has led to the telco giant's shares rising to a multi-year high of $4.24.
This means the Telstra share price is now up over 8% since this time last year, which compares favourably to a 5% decline by the ASX 200 index.
Why is the Telstra share price hitting a new high?
Demand for Telstra's shares has been strong this year thanks to the company's defensive qualities.
As it offers an essential service that few would go a day without, Telstra is well-placed to navigate the current economic environment. Particularly now that it has inflation-linked mobile plans.
In addition, the mobile market is benefiting from rational pricing, which should be supportive of margins and customer retention.
Last week, Goldman Sachs noted that "[i]ndustry feedback suggests that mobile rationality is set to continue, with the only potential risk (in our view) to further pricing increases, if TLS/Optus postpaid sub growth was to decline for an extended period."
The good news is that the broker sees "this as unlikely given improving quarterly cadence & meaningful recent Vodafone pricing increases." It also expects to tier 2 pricing to "continue to increase and provide scope for Optus to follow Telstra price rises higher."
It is partly for this reason that Goldman Sachs recently upgraded the company's shares to a buy rating with a $4.50 price target. Based on the current Telstra share price, this implies potential upside of 6.1% for investors over the next 12 months.
Another leading broker believes its shares can rise beyond this. A recent note out of Morgans reveals that its analysts have an add rating and $4.70 price target on them. This suggests almost 11% upside from current levels.
And let's not forget the dividends! Both brokers are expecting 17 cents per share fully franked dividends in FY 2023. This represents an attractive 4% yield for investors.
Goldman then expects an increase to 18 cents per share in FY 2024, which will mean a 4.25% yield.
All in all, these brokers appear confident that it's not too late to pick up shares.
