Telstra Group Ltd (ASX: TLS) shares have started the first month of the new financial year around 2% lower at $5.99 a piece, at the time of writing.
The telco stock also ended June around 1.55% lower, after softening from a multi-year high in mid-May.
For the year to date, Telstra shares are now around 2% higher, and they're also around 3% higher than this time last year.
For context, the S&P/ASX 200 Index (ASX: XJO) is up around 0.6% for the year to date and around 3% higher over the past 12 months, at the time of writing.
Now the question is, are Telstra shares still a buy in July? Or has the telco stock already passed its peak?
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Here's what the experts think
Market Index data shows the majority of brokers have a buy rating on Telstra shares. The $5.32 target price implies around a 7% upside at the time of writing.
Analysts are more bearish on TradingView. All 10 analysts have a hold rating on the shares. The average $5.22 target price implies a potential 5% upside at the time of writing. Although some forecast Telstra shares to climb around another 12% to $5.57 over the next 12 months.
Macquarie thinks Telstra shares are trading close to fair value. The broker downgraded its rating to a hold earlier this month and shaved its price target on Telstra shares to $5.57. Based on the current share price of $5.14, the price target suggests potential upside of around 8%.
The team at Shaw and Partners give Telstra a sell rating. The broker said it thinks the stock has been trading at elevated levels and was pushed higher by its defensive appeal. But it adds that underlying growth is limited, and the dividend yield is becoming less attractive.
Bell Potter recently reiterated its hold rating on Telstra shares and set a $5.10 target price. The broker said it expects little, if any, surprises at the company's upcoming results, so the focus shifts to FY27 outlook and guidance. It forecasts mid to high-single-digit growth in the key metrics of underlying EBITDA, cash EBIT, and EPS.
Up or down: What could influence Telstra's shares this month?
The two key themes to keep an eye on in July are Telstra's mobile and broadband price changes, and any commentary ahead of the company's FY26 results announcement next month.
The telco implemented price changes on some of its plans from today. If customers largely accept the higher prices without switching providers, investors may gain confidence that Telstra can continue growing earnings. But if the opposite happens, then investors might start to question the company's competitive position.
And of course, any information about upcoming earnings, especially commentary on cash flow or dividends, would also influence investor sentiment.
