4 blue-chip stocks with dividend yields greater than 5%

If you’re in the market for income stocks, these should be on your watchlist.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Since interest rates are stuck at 2.5%, the returns from term deposits and savings accounts are terrible. However, inside the S&P/ASX 200 (ASX: XJO) (INDEX: ^AXJO) there’s a whole heap of companies with dividends of 5% or more.

Whilst dividends are great ways to receive a better income from your investment, it’s important you choose only the best companies to buy and hold because a significant drop in share price will quickly wipe out any benefit you’d receive from a 5% payout.

Here are four big dividend stocks which should be on your watchlist.

1. Cromwell Property Group (ASX: CMW) is a leading property investment fund which is forecast to distribute a dividend of 7.5 cents in FY14, representing a yield of around 7.6% at today’s share price. With a stronger property market and low interest rate environment, earnings are expected to increase over the next two years.

2. For a consistent fully franked dividend payment, it’s hard to go past Telstra Corporation Ltd (ASX: TLS). The telco giant controls a huge share of the mobiles, fixed internet and pay-tv markets here in Australia, yet is looking to grow its overseas presence. It is forecast to pay a 5.5% dividend fully franked.

3. When things go right in the insurance industry, it can be very lucrative for shareholders. Insurance Australia Group Limited (ASX: IAG) pays the biggest dividend of the big insurers, currently forecast at 6.1% fully franked.

4. Of the big banks National Australia Bank Ltd. (ASX: NAB) appears to be the cheapest and is forecast to pay the highest dividend – currently 6.1% fully franked.

The BEST buy of all

Whilst each of these companies are forecast to pay substantial dividends to eligible shareholders in the next 12 months, I believe, for now, they’re best left for the watch list. That’s because there’s an even better dividend stock available to buy on the ASX.

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

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

person reading news on mobile phone
⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »