STUDY: Telstra's Brand Growth Is Smashing It In Australia

Getty/Cameron Spencer

Telstra’s brand value has soared 59% to $9.3 billion in one year, making it one of the top 20 most-valuable names in global telecom, according to new research.

Consultancy Brand Finance has released its annual top 100 list of Australian brand values, with Woolworths taking the top spot, worth $12 billion (up 44%).

“The operator [Telstra] has retained its advantage in network coverage over Optus and continues to leverage its brand effectively through its triple-play and broadband offering,” the report says.

“A 9.2% growth in profits has led to an increased dividend this year for the first time since 2006.”

Things are great in the short term. Though a Deutsche Bank note this week predicted Telstra’s growth would hit a “black spot”, and that consensus earning were “too optimistic”.

“We believe TLS’s share price will be supported in the near term due to strong earnings momentum into 2H14, increasing dividends and the potential for $2 billion in additional capital management,” DB’s analysts wrote.

“Looking longer term however we believe that consensus earnings are too optimistic with market share losses in broadband and mobile likely to constrain NPAT and EBITDA growth to 2-3% at best.

“With the valuation already full and limited earnings growth we struggle to see a catalyst for outperformance.”

Meanwhile, A News Corp Australia report says Telstra’s chief financial officer is being considered as the telco’s next CEO.

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