Telstra Group Ltd (ASX: TLS) shares are edging lower today.
Shares in the S&P/ASX 200 Index (ASX: XJO) telco provider closed on Friday trading for $5.31. During the Monday lunch hour, shares are swapping hands for $5.30 apiece, down 0.3%.
For some context, the ASX 200 is down 0.8% at this same time.
Longer-term, Telstra shares have gained 15.5% over the past 12 months, or almost three times the 5.5% one-year gains posted by the benchmark index.
And that doesn't include the two fully franked dividends the telco giant paid out over the full year. Telstra stock currently trades on a 3.8% fully franked trailing dividend yield.
Atop its own operational successes, which drove solid first half year earnings growth, Telstra has also been catching headwinds from its recently increased $1.25 billion share buyback program.
When a company buys back its shares, it reduces the amount available on the market, which often helps support the share price.
As of last Friday, the company had repurchased around 214 million shares, the buyback currently scheduled to run through 30 June.
Which brings us back to our headline question…
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Telstra shares: Buy, hold or sell?
Catapult Wealth's Blake Halligan recently ran his slide rule over the ASX 200 telco (courtesy of The Bull).
Halligan noted:
The telecommunications giant recently reaffirmed its 2026 fiscal year outlook, guiding to cash earnings per share growth amid maintaining capital discipline as it progresses its on-market share buyback of up to $1.25 billion.
Looking ahead, Halligan added, "Mobile price rises are expected to support revenue growth in full year 2026."
But despite these potential tailwinds, he issued a hold recommendation for Telstra shares.
According to Halligan:
However, regulatory uncertainty around proposed higher spectrum licence fees remains a medium-term headwind. Investors can expect a fully franked dividend of 21 cents a share for full year 2026, but near‑term upside appears limited, in our view.
Why did the ASX 200 telco beef up its billion-dollar share buyback?
Telstra released its half year results (H1 FY 2026) on 19 February.
The company initially announced its share buyback program in August last year, reporting its intention to buyback up to $1.0 billion in stock.
But, following the half year results, that buyback was ramped up to $1.25 billion.
Commenting on the extra $250 million in potential share repurchases at the time, Telstra CEO Vicki Brady said:
Today, we are also announcing an increase in our current on market share buyback from up to $1 billion to up to $1.25 billion. This increase is supported by strong progress in completing $637 million of the buyback in the half, earnings growth, and the strength of our balance sheet.
Telstra shares closed up 3.6% on the day of the results release.
