TLS – UBS rates the stock as Buy

UBS now assumes Telstra cuts the dividend to $0.14, potentially from the second half of FY20. Long-term forecasts for earnings per share are unchanged at $0.18.

What appears less well understood, in the broker’s view, is the impact the crisis and a weaker macro outlook will have on medium-term mobile revenue growth aspirations.

The timing of one-off NBN payments and franking could also create complications. The broker retains a Buy rating and $3.70 target.

Sector: Telecommunication Services.

Target price is $3.70.Current Price is $3.20. Difference: $0.50 – (brackets indicate current price is over target). If TLS meets the UBS target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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