The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has been boosted to fresh five-year highs as investors have sought out defensive and high-yielding dividend stocks as an alternative to storing their money in low-returning term deposits.
The big four banks, as well as other companies such as Woolworths (ASX: WOW) or Wesfarmers (ASX: WES), have bolted ahead and could now be considered to be overpriced, and it remains unlikely that they will deliver market-beating returns in the long run.
However, while that might be the case for a number of Australia's largest companies, there are a number of blue-chip stocks that are still trading at attractive prices and could form a solid foundation for your portfolio.
Coca-Cola Amatil (ASX: CCL) is one such company. The company is the manufacturer and distributor of some of the world's most popular brands. Although it has delivered shareholders consistent returns over the last decade, this year has been tough due to the high Australian dollar as well as pricing pressures from grocers and its primary rival Schweppes.
With Coca-Cola Amatil's shares currently trading at around $12.25 – which is 20.6% below its 52-week high of $15.43 – following a number of profit downgrades, now could be the perfect time to add this company to your holdings.
Unlike Coca-Cola Amatil, Telstra (ASX: TLS) has performed very strongly for shareholders over the last 12 months. As the nation's largest telecommunications company, investors have not only enjoyed its incredible 5.5% fully franked dividend yield, but also its long-term potential. Telstra's market dominance is set to continue increasing well into the future as individuals and businesses become more and more reliant on mobile and broadband services. Shares are currently trading at $5.18 each.
Westfield Group (ASX: WDC) is one of the world's largest shopping centre operators and is focused on strengthening its balance sheet by divesting from non-core assets and using the proceeds to expand or develop their most profitable stores. While this strategy could affect earnings in the short-term, it is setting itself up for a strong future. With shares still trading under $11, Westfield is looking very attractive.
Foolish takeaway
With so many blue chips looking expensive, these three are still reasonable additions to any investor's portfolio.
