We present a stochastic formalism for signal transduction processes in a bacterial two-component system. Using elementary mass action kinetics, the proposed model takes care of signal transduction in terms of a phosphotransfer mechanism between the cognate partners of a two-component system, viz., the sensor kinase and the response regulator. Based on the difference in functionality of the sensor kinase, the noisy phosphotransfer mechanism has been studied for monofunctional and bifunctional two-component systems using the formalism of the linear noise approximation. Steady-state analysis of both models quantifies different physically realizable quantities, e.g., the variance, the Fano factor (variance/mean), and mutual information. The resultant data reveal that both systems reliably transfer information of extracellular environment under low external stimulus and in a high-kinase-and-phosphatase regime. We extend our analysis further by studying the role of the two-component system in downstream gene regulation.