Buy this ASX 200 share in the aftermath of Optus hack: expert

Australia's second biggest telco is facing intense criticism. Which stock can you add to take advantage?

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The unauthorised access of personal data for millions of Optus customers has dominated headlines the past fortnight.

Australia's second largest telecommunications provider currently has a full plate battling fierce criticism from its own customers, the government and cybersecurity experts.

While data hacks are devastating for the victims and the business, one stock analyst has suggested an opportunistic buy could be on the cards to cash in on Optus' woes:

Already going places, but now assisted by Optus' failure

Optus' largest rival and the biggest telco in the country is Telstra Corporation Ltd (ASX: TLS).

While the Telstra share price has fallen more than 9% year to date, Marcus Today analyst Layton Membrey reckons there is a golden buy opportunity right now.

"This leading telecommunications provider is likely to generate new customers following a cyber attack at competitor Optus and the negative sentiment that followed towards Optus," Membrey told The Bull.

But it's not just external events contributing to Membrey's conviction.

He likes the fundamentals of Telstra and where it's heading in the long run.

"Telstra recently reaffirmed full-year total income guidance of between $23 billion and $25 billion in fiscal year 2023."

Last week the team at Morgans also rated Telstra as a buy.

"After a major turnaround, Telstra has emerged in good shape with strong earnings momentum and a strong balance sheet," read Morgans' memo.

"In late CY22, shareholders vote on Telstra's legal restructure, which opens the door for value to be released."

According to Morgans analysts, Telstra's current 7 times enterprise value to earnings ratio doesn't fairly reflect some of its "high-quality long life assets" such as InfraCo.

"We don't think this is in the price, so see it as value-generating for Telstra shareholders," read the memo.

"This free option, combined with likely reputational damage to its closest peer, following a major cybersecurity incident, means Telstra looks well placed for the year ahead."

Telstra shares are currently paying out a 3.5% dividend yield.

According to CMC Markets, 11 out of 16 analysts currently rate Telstra shares as a buy, with 10 of them recommending it as a strong buy.

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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