The Telstra Corporation Ltd (ASX: TLS) share price ended Wednesday's trading session in the green amid a sea of red. That's after the company launched its mobile tower infrastructure business, Amplitel.
At market close, shares in Australia's largest telco finished at $3.89 – up 1.3%. The S&P/ASX 200 Index (ASX: XJO), meanwhile, closed 0.21% lower.
Let's take a closer look at today's news.
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Telstra's new business
Telstra restructured its business in order to enable the $2.8 billion sale of a 49% interest in its tower business.
At the time, Telstra said it would return 50% of the proceeds to shareholders and use the remaining half for debt reduction. When the company delivered its full-year results, Telstra announced an 8-cents per share dividend (16 cents full-year) and a $1.35 billion on-market share buyback. The buyback is because of the recent sale.
In today's announcement, Telstra revealed the name of the new infrastructure business that it retains a 51% stake in – Amplitel. Telstra says the name is a hybrid of "amplify" and "Telstra". The company says it "reflect(s) our history and the increasing importance of our infrastructure that provides the foundation for wireless connectivity in this country".
Telstra also called today's announcement the "most significant change since privatisation". This news may have excited investors, judging by the rise in the Telstra share price.
What are brokers saying?
As The Motley Fool has previously reported, Telstra is seen as a buy by many analysts. Part of the reason for this is Telstra's "T22 strategy" to make the company leaner and more efficient. The partial sale of its tower business was essential to this.
Telstra CEO Andy Penn is targeting mid to high single-digit operating earnings growth in FY 2022. He is then targeting further growth in FY 2023.
Analysts at Morgans are calling Telstra a buy and are tipping the Telstra share price to hit $4.34. It also expects 16 cents per share fully franked dividends in FY 2022 and FY 2023.
Telstra share price snapshot
Over the past 12 months, the Telstra share price has increased 37.1%. It's outperformed the ASX 200 by about 11 percentage points. Year-to-date, the company's shares have risen around 30%.
Telstra has a market capitalisation of approximately $46 billion.
