Telstra Group Ltd (ASX: TLS) shares are 0.1% higher in early morning trade on Thursday. At the time of writing, the shares are changing hands at a 10-year high of $5.28 a piece.
The telco's stock has leapt higher since it posted its impressive half-year FY26 results last month. Telstra shares are now 8% higher for the year-to-date and an impressive 28% higher than this time last year.
For context, the S&P/ASX 200 Index (ASX: XJO) has climbed just over 8% over the same 12 month period.
The past month has been a great success story for Telstra, and I still think the telco is a buy.
Here are three reasons why to add Telstra shares to your portfolio today.
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1. Telstra is a textbook defensive stock
Internet access and mobile phone connectivity are necessary for everyday life. This means the company is likely to perform steadily, regardless of what stage of the economic cycle we're in.
Telstra confirmed this recently when it posted a strong half-year FY26 result last month. The company's profit and earnings increased, and there were gains seen across every financial metric and division.
The results show that the company has a predictable cash flow and reliable earnings, which is classic for a strong defensive stock.
And this is great news for investors who want to hedge against potential volatility elsewhere in the index.
2. Telstra offers great passive income
It's this defensive nature which means Telstra can offer its investors a reliable passive income with a good dividend yield.
In fact, one of the best things about Telstra is that its dividend payout ratio is close to 100% of its earnings. That unlocks a good dividend yield.
Telstra pays investors two dividends every year, in March and September. Investors are due to receive an interim 10.5 cent dividend, 90.48% franked, next week.
In FY25 the company paid investors an annual dividend of 19 cents per share, which translates to a 3.9% dividend yield at the time of writing. The telco is expected to pay an even larger 20-cent final dividend for FY26, which represents a 5.25% increase year-on-year. For FY27 the dividend payout is expected to increase again to 21 cents per share.
3. Analysts are still tipping an upside
Even after the latest price rally, some analysts are still tipping more upside ahead for Telstra shares.
TradingView data shows that five out of 15 analysts have a buy or strong buy rating on Telstra shares. The other 10 have a hold rating.
The maximum target price is $5.60, which implies a potential 6% upside at the time of writing.
