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0029 GMT - Betting on telecoms company Telstra (TLS.AU) maintaining its dividend? You shouldn't. That's the message from Credit Suisse, which cuts its dividend forecast to A$0.25/share from FY18. Telstra can't support the current payout given it is taking a A$2 billion-A$3 billion Ebitda hit from fixed-line customers moving to the government-owned National Broadband Network, Credit Suisse says. It expects Telstra to confirm a dividend reduction at its FY17 result in August. "We assume A$1.8 billion of share buybacks across FY18/19 to maintain the overall dollar value of returns to shareholders in those years and help ease the transition to the lower dividend," Credit Suisse says. Its price target drops 13% to A$4.00/share, while its underperform call is unchanged. TLS last traded at A$4.35. ([email protected]; @dwinningWSJ)
(END) Dow Jones Newswires