What Just Happened: Telstra Shares Hit Nine-Year Highs
Telstra shares are making headlines for the right reasons. Australia’s largest telco delivered a standout first-half FY26 result. The group underlying EBITDA rose across all major business lines. The interim dividend jumped to 10.5 cents per share.Â
That is the biggest interim payout in almost a decade. The stock surged to levels not seen since 2017.
Telstra posted a profit jump of 8.1% to A$1.2 billion for the half. Revenue came in at A$11.8 billion. Earnings grew 4.7% to A$4.4 billion.Â
The numbers did not just beat expectations. They told the story of a genuine business transformation. Telstra has shifted from a bloated legacy telco to a lean growth machine.
Over the past 12 months, Telstra shares have risen 27%. The S&P/ASX 200 Index returned just 7% over the same period. That is a meaningful outperformance by any measure. For investors watching from the sidelines, the question is simple. Are there still strong reasons to buy Telstra shares today?
Telstra Group Limited (ASX: TLS) has delivered 27% share price growth over the past 12 months. (Source: Telstra)Â
Why This Story Matters to Every Australian Income Investor
Most Australians have a personal relationship with Telstra. Many are customers. Others are former shareholders who sold too early. The Telstra of 2026 is a very different business. It no longer carries the baggage of a shrinking dividend and a structureless cost base.
Today’s Telstra generates real earnings growth. Dividends are rising every year. Returns are compounding through mobile pricing power and AI-driven cost discipline. For SMSFs and retirees seeking franked income, this combination is rare. It directly challenges the assumption that Telstra is a finished growth story.
Wilson Asset Management holds the stock. The fund described Telstra as fairly valued after the H1 FY26 result. That is less a warning and more a quiet endorsement. It signals institutional money is not rushing to exit at current levels.
Who Is Behind This Turnaround: The Company and the CEO
Company: Telstra Group Limited (ASX: TLS) Founded: 1901 | Headquarters: Melbourne, Victoria CEO: Vicki Brady | Employees: ~27,000 Market Cap: A$57.6 billion (March 2026)
CEO Vicki Brady credited the result to disciplined execution. The strategy is called Connected Future 30. It is Telstra’s multi-year roadmap for sustainable growth. Under Brady, the company has pursued three levers at once. These are mobile revenue growth, cost reduction, and shareholder returns.
Telstra Group Limited CEO Vicki Brady [The Australian]
Key stakeholders driving the story include:
- UBS — Neutral rating but constructive long-term earnings outlook
- Telstra Mobile — A$2.7 billion in EBITDA for the half
- Accenture — joint venture partner accelerating AI adoption
- Mobile subscribers — Retail mobile services in operation increased by ~581,000 in H1 FY26.
Over 75% of Telstra’s AI-enabled workforce uses those tools weekly. The company is investing in its Data and AI Academy. This is not a talking point. It is a measurable shift with direct margin implications.
Where the Growth Is Coming From: Australia’s Mobile Market
Telstra’s investment case is a domestic Australian story. That is a feature, not a limitation. Australia’s mobile market is a consolidated duopoly. Telstra commands a consistent premium. It earns that premium through genuine network superiority.
Telstra’s mobile network superiority drives consistent ARPU growth across postpaid, prepaid and wholesale categories. (Source: ABC)Â
Mobile revenue grew 4% to A$5.8 billion for the half. Mobile EBITDA rose 4% to A$2.7 billion. Mobile services revenue climbed 5.6%. Postpaid ARPU grew 4.8%. Prepaid ARPU grew 14.7%. Wholesale ARPU grew 7%. These numbers reflect real pricing power. Customers pay more because alternatives are genuinely inferior.
Telstra also operates internationally through Digicel Pacific. This business serves customers across the South Pacific. It provides geographic diversification. It also offers exposure to developing market connectivity growth. Many pure-ASX investors overlook this entirely.
When the Numbers Were Reported and Key Dates Ahead
Telstra lodged its H1 FY26 results with the ASX on 19 February 2026. The period covered the six months to 31 December 2025. The result included raised buyback guidance. The interim dividend was the largest in nearly a decade. Telstra shares hit nine-year highs in the days following.
Key dates every investor should track:
| Event | Date |
| H1 FY26 Results Released | 19 February 2026 |
| Ex-Dividend Date | 25 February 2026 |
| Dividend Payment Date | 27 March 2026 |
| FY26 Full-Year Results | August 2026 |
The 10.5 cent interim dividend pays on 27 March 2026. The payout ratio is 75% of cash EPS. That reflects confidence in earnings. It also shows discipline in retaining cash for investment. The Dividend Reinvestment Plan lets holders receive shares instead of cash. This is a powerful compounding mechanism for long-term investors.
How the Investment Case Plays Out: 3 Verified Reasons to Buy Telstra Shares
Here is the most actionable part of this article. All figures are verified from official Telstra results and UBS broker research. These are the three reasons the case holds up today.
Mobile Pricing Power Is Outrunning Cost Growth
Telstra cut A$179 million from underlying operating expenses during the half. Earnings grew faster than revenue. CEO Vicki Brady called this positive operating leverage. UBS forecasts cost growth capped at just 1.5% CAGR over four years. Mobile ARPU is forecast to keep rising above that rate.
UBS predicts EBITDA margin expansion of 60 basis points per year from FY26 to FY30. AI adoption is the key driver of those efficiency gains. Net profit is projected to rise from A$2.3 billion in FY26 to A$2.8 billion by FY29. That is 22% growth without heroic revenue assumptions.
Telstra Dividends Are Growing With Plenty of Runway Left
UBS forecasts annual dividends rising every year through to FY30. The projection goes from 21 cents in FY26 to 29 cents in FY30. That is a 38% increase in the payout over four years. At today’s share price, the FY30 yield would reach 5.7% before franking credits. That would make Telstra one of the ASX’s top income stocks.
The share buyback was increased from A$1 billion to A$1.25 billion for FY26. Buybacks reduce the share count. That lifts earnings and dividends per share over time. Growing buybacks and growing dividends together signal genuine capital discipline.
The Network Moat Is Getting Wider Every Year
Telstra is investing in 5G Advanced capability. It launched the Adaptive Network Centre for enterprise customers. This platform lets businesses design, order, and monitor connectivity services. AI adoption is accelerating across its 27,000-strong workforce. These investments build tomorrow’s moat on top of today’s.
IoT connections on Telstra’s network jumped over 24% during the half. Machine-to-machine connectivity is a fast-growing market. Australia’s industrial and agricultural sectors are rapidly digitising. Competitors lack the infrastructure to replicate this at scale.
IoT connections on Telstra’s network surged over 24% in H1 FY26. Australia’s digitising industries are driving that demand. (Source: Telecom Review Asia)Â
The One Risk Worth Watching Before You Buy
No honest article ignores the downside. Telstra lost roughly 95,000 NBN subscribers during the half. Smaller, cheaper broadband rivals are chipping away at fixed-line market share. Mobile strength is currently masking that structural headwind. If NBN losses accelerate, the earnings story gets harder to sustain.
At a trailing P/E of 25.86 times and a price-to-sales ratio of 2.57 times, Telstra is not cheap. It is priced for continued execution. Any miss on mobile ARPU or an unexpected cost blowout could trigger a sharp share price reaction.
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Verdict: Three Reasons That Hold Up Under Scrutiny
The reasons to buy Telstra shares today are not speculative. They are grounded in verified half-year results. Six consecutive years of dividend growth back the income case. A A$1.25 billion buyback programme supports shareholder returns. A superior mobile network earns premium pricing in a quality-rewarding market.
For income-focused ASX investors with a multi-year horizon, Telstra delivers. It combines yield, earnings growth, and defensive characteristics in one package. That combination is hard to find anywhere else on the exchange right now.
FAQS
Q1. Are Telstra shares a good buy in 2026?
A1. Telstra shares have risen 27% over the past 12 months. The business is generating real earnings growth. Dividends are rising every year. The mobile network moat is widening. For long-term income investors, the case remains compelling at current levels.
Q2. What is the Telstra share price right now?
A2. As of March 2026, Telstra shares trade between A$5.16 and A$5.26. The 52-week range runs from A$4.06 to A$5.26. The stock is near nine-year highs following the strong H1 FY26 result.
Q3. What is the Telstra dividend for 2026?
A3. Telstra paid an interim dividend of 10.5 cents per share for H1 FY26. That is the largest interim dividend in almost a decade. The payment date is 27 March 2026. The trailing dividend yield sits at approximately 3.85%.
Q4. Will Telstra dividends keep growing?
A4. UBS forecasts Telstra dividends rising every year through to FY30. The projection moves from 21 cents per share in FY26 to 29 cents by FY30. That represents a 38% increase in the annual payout over four years.
Q5. Are Telstra dividends fully franked?
A5. The H1 FY26 interim dividend was 90.5% franked. That is a slight change from previous years. Telstra had paid fully franked dividends since 1999. The partial franking reflects earnings growing faster than the franking credit balance.
Disclaimer:Â
This article is for informational and educational purposes only. It does not constitute financial or investment advice. Always consult a licensed financial adviser before making investment decisions. Past performance is not indicative of future results.
Sources
https://www.telstra.com.au/aboutus/investors/financial-results?Â
