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Telstra, Coca-Cola Amatil, Westpac and ANZ: Should you buy?

Telstra Corporation Ltd (ASX: TLS), Coca-Cola Amatil Ltd (ASX: CCL), Westpac Banking Corp (ASX: WBC) and Australia and New Zealand Banking Group (ASX: ANZ) are some of country’s best companies. Together they make up a large part of the S&P/ASX 200 (ASX: XJO) (^AXJO).

They offer security, BIG dividend yields and experienced management teams. But does that automatically make them a buy? Let’s find out.

Telstra

As Australia’s biggest telco, it has a lot to offer investors and anyone who uses technology. Its superior networks have long provided Telstra shareholders with great dividend yields and strong cash flows. Now, management are leveraging its local success for international growth. As a result I believe, over time, Telstra shares will trend higher. Currently shares pay a 5.3% fully franked dividend.

Westpac Banking Corp

I’ve been quite bearish on Westpac over the past year for a number of reasons. First, its shares are expensive. Second, it has no real long-term growth strategy (which has been reflected by its poor results over the past two years) and lastly, the banking industry is becoming more competitive. While prices are high, my advice would be to steer clear of Westpac shares.

ANZ Banking Group

ANZ is the opposite of Westpac. Its international growth strategy has finally gained traction and now accounts for 19% of FX-adjusted cash profit. In addition, ANZ has remained a highly profitable lender of money in Australia and New Zealand. However, in the past 18 months, its shares have become a bit rich and I believe, at current prices, it would be more of a ‘hold’ than a ‘buy’.

Coca-Cola Amatil

After a drop in earnings, being knocked around in the media over possible government funding for its SPC Ardmona business and a change of CEO, CCA’s share price fell hard. However the headwinds its businesses face are short term in nature and the company now represents a great long-term buy and hold. Currently it is forecast to yield 4.7%.

One even better buy!

I think Telstra and Coca-Cola Amatil have a lot to offer long-term investors. However there's one ASX stock I believe is an even better buy than any of these 4! Don't miss what could be the 'story stock' of 2014! Get The Motley Fool's #1 pick now in our newly updated investment report. It's yours FREE. Simply click here for your copy of "The Motley Fool's Top Stock for 2014."

Motley Fool Contributor Owen Raszkiewicz does not have a financial interest in any of the mentioned companies. 

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