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Why Telstra Group (ASX:TLS) Is Back In The Spotlight

Simply Wall St · 1d ago

Telstra Group (ASX:TLS) has switched on the Perth to Sydney route of its Aura Network, a long-haul fibre link that deepens Australia’s east to west data corridor and targets rising cloud and AI traffic.

Recent trading has been fairly steady, with Telstra Group’s share price at A$4.86 after a 1-day gain of 1.25% and a modest 30-day share price return of 1.46%. The 1-year total shareholder return of 5.24% and 3-year total shareholder return of 42.51% point to longer term momentum that investors are weighing against near term Aura Network news and broader sentiment.

Scan beyond Telstra Group and see which other fibre, cloud and AI infrastructure plays are gaining traction in our curated list of 91 AI infrastructure stocks.

Telstra Group now trades only slightly below the average analyst target and well above where it sat three years ago. The key question is whether the Aura build still leaves meaningful upside on the table or if most of the easy gains have already been taken.

Most Popular Narrative: 4% Undervalued

Telstra Group’s most followed valuation story pins fair value at A$5.06, only modestly above the A$4.86 last close, with the Aura build and broader digital push feeding into that gap.

Telstra's ongoing investment in expanding and modernizing its core mobile and fixed network, demonstrated by the rollout of 5G Advanced, intercity fibre projects, and satellite-to-mobile services, positions the company to benefit from surging mobile data consumption, proliferation of connected devices, and the anticipated explosion in demand from IoT, AR/VR, and cloud-enabled applications; these are likely to drive sustained revenue growth and justify premium pricing. (Impacts: Revenue, ARPU, long-term growth)

See why 111 investors see Telstra Group as 4% undervalued.

Result: Fair Value of A$5.06 (UNDERVALUED)

Still, the story of Telstra Group can unravel if domestically focused earnings face pressure from heavier network spending, or if regulators squeeze pricing and wholesale economics.

Find out about the key risks to this Telstra Group narrative.

Next Steps

Mixed headlines around Telstra Group are only half the story. Move quickly, pressure test the underlying data, then weigh the 3 key rewards and 2 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.