So this is actually a really difficult question that cuts to the heart of the debate on the origins of the Cold War. I tend to ascribe to the view that Kennan was largely correct, but there are prominent historians who feel that he completely misread the situation and helped the US miss a chance for lasting peace. For this I'll provide some sections of the telegram along with a brief assessment of whether or not Kennan got it right, and will close with some book recommendations for you that draw on all sides of the debate.

Kennan started off by looking at how the Soviet Union portrayed itself and the west internally, identifying the first principle as:

USSR still lives in antagonistic "capitalist encirclement" with which in the long run there can be no permanent peaceful coexistence.

Kennan is correct that the Soviets portrayed the capitalist world in hostile terms following the defeat in Germany. Here depicting a celebration of the war, and while it does acknowledge the other two allies the emphasis is clearly on the Soviet soldier. This more or less marks the high point of post-war feelings and already shows efforts to downplay the role of other nations in the Great Patriotic War. This is particualraly obvious when compared with earlier versions of wartime propaganda. As relations soured the propaganda became more negative as seen here with the slogan We sow food, they sow death. Note the Truman lookalike plotting the military occupation of Europe.

In the Soviets defense, they are correct about being encircled by capitalist countries, and given the conflicting ideologies fearing that there could be no coexistence is not entirely unreasonable. The same is true from the U.S. point of view facing down a large and powerful ideology with leaders that openly express desire to foment revolution.

The next section of the telegram dives into the background of the Soviet outlook:

At bottom of Kremlin's neurotic view of world affairs is traditional and instinctive Russian sense of insecurity. Originally, this was insecurity of a peaceful agricultural people trying to live on vast exposed plain in neighborhood of fierce nomadic peoples. To this was added, as Russia came into contact with economically advanced West, fear of more competent, more powerful, more highly organized societies in that area. But this latter type of insecurity was one which afflicted rather Russian rulers than Russian people; for Russian rulers have invariably sensed that their rule was relatively archaic in form fragile and artificial in its psychological foundation, unable to stand comparison or contact with political systems of Western countries. For this reason they have always feared foreign penetration, feared direct contact between Western world and their own, feared what would happen if Russians learned truth about world without or if foreigners learned truth about world within.

This is a good read of Soviet outlook (though obviously they would dislike the term neurotic). Insecurity is a major theme in Soviet foreign policy and explains why Stalin insisted on Eastern Europe as a Soviet sphere of influence at Yalta. It also provides the underlying reason why the Soviets executed Polish military officers in the Katyn Forrest Massacre, targeted elites throughout Eastern Europe, and did not support and even took antagonistic action towards resistance groups that were not communist during the war. Stalin effectively sought to ensure that the only individuals capable of ruling in that region owed their power to Moscow and that there was not an educated class of potential leaders to challenge them.

The point about fearing foreign influence is most poignant with the harsh treatment many returning POWs faced and the efforts the Soviet government took to ensure that soldiers in the Red Army did not overly publicize the relative prosperity they observed in their march west, where they saw individual family houses, plentiful automobiles and other markers of individual wealth that demonstrated that before the war came the capitalist countries were far superior to their own.

Kennan next outlined what this would mean for Soviet policy:

(a) Internal policy devoted to increasing in every way strength and prestige of Soviet state: intensive military-industrialization; maximum development of armed forces; great displays to impress outsiders; continued secretiveness about internal matters, designed to conceal weaknesses and to keep opponents in dark.

Things like the May Day parades speak to this, as well as the out sized role that the military played in the Soviet economy and the disproportionate resources funneled into it.

(b) Wherever it is considered timely and promising, efforts will be made to advance official limits of Soviet power. For the moment, these efforts are restricted to certain neighboring points conceived of here as being of immediate strategic necessity, such as Northern Iran, Turkey, possibly Bornholm However, other points may at any time come into question, if and as concealed Soviet political power is extended to new areas. Thus a "friendly Persian Government might be asked to grant Russia a port on Persian Gulf. Should Spain fall under Communist control, question of Soviet base at Gibraltar Strait might be activated. But such claims will appear on official level only when unofficial preparation is complete.

This is the central point of the telegram, that the Soviets would seek to expand where practicable. In the West's eyes this meant when unopposed. The opportunistic way they took over Eastern Europe, early support for communist movements in Greece and Italy (later withdrawn when the US made clear it wouldn't tolerate it), the refusal to permit free elections in Poland despite the promises at Yalta, support for communist North Korea (and later for the invasion south), and early support for Mao speak to this. Similarly the consistent attempts to expand their influence in Berlin and the Czech coup of 1948 lend further weight to the argument. However, the break with Tito, non-resistance to Turkey joining NATO provide some evidence that efforts to expand would not be quite as monolithic. Similarly the decision to back down over Iran and ultimately withdraw Soviet troops from the northern oilfields indicate the possibility of finding a working relationship. Despite this, I still tend to think Keenan got this point mostly right. Throughout the Cold War there are many instances where the Soviets took advantage of either U.S. apathy, mistakes, or its inattentiveness to expand their influence.

Based on this, I would argue that the U.S. pursued a reasonable course in initiating containment and a more antagonistic relationship with Moscow.

Some good books on the early Cold War: Preponderance of Power by Melvyn Leffler, a huge tome that covers the first seven years or so in great detail, Strategies of Containment by John Lewis Gaddis, covers the entirety of the Cold War and an absolute classic, Roosevelt's Lost Alliances by Frank Costigliola, looks at the importance of interpersonal relationships in diplomacy and blames Truman, Kennan and others for the Cold War, The Global Cold War by Odd Arne Westad, another that looks at the entirety of the Cold War and ascribes more agency to nations generally viewed as proxies.

TL:DR Kennan got it mostly right.