Coca-Cola Amatil Ltd (ASX: CCL), Beach Energy Limited (ASX: BPT) and Telstra Corporation Ltd (ASX: TLS) are iconic Australian businesses with a rich history for growing shareholder wealth. In the past five years alone, their share prices are up 11%, 110% and 60% respectively, not including dividends. With the share market tipped to surge higher in coming months, could now be your opportunity to position your portfolio to benefit?
CCA is the exclusive bottler and distributor of world famous brands such as Coca-Cola, Jim Beam, Mother, Sprite and more. In recent times however, CCA’s growth strategy has been anything but smooth sailing with its tinned fruit business, SPC Ardmona, succumbing to intense international competition and its Indonesian expansion struggling with adverse foreign exchange rates and increased labour costs. In addition, its core beverage business has been locked in an intense and costly price war with rival Schweppes and the competition between supermarket giants Woolworths Limited (ASX: WOW) and Coles – owned by Wesfarmers Ltd (ASX: WES) isn’t helping. As a result, the company’s profits and share price have fallen dramatically.
However, now with a reduced share price, the market is offering many investors the opportunity they’ve been waiting for and those who choose to buy in now could realise significant long-term value by holding CCA shares.
With a generous 5.4% fully franked dividend, infrastructure payments from the government’s NBN Co. and a focus on Asian markets, Telstra’s shareholders have successfully battened the hatches in anticipation of low interest rates and are safely setting themselves up for a prosperous future. Although risks are present with its international expansion, Telstra has enviable profit margins and a huge customer base from which it’ll leverage international growth.
Although it is not as well known as the other two companies, Beach Energy shareholders and investors have every reason to be just as excited about their company’s future. Beach is the Cooper Basin’s biggest oil and gas company, and also has exploration tenements in a number of countries right around the world. Beach trades on a forward P/E ratio of less than 8 and forecast dividend yield of 3% fully franked. With a healthy cash position, Beach also has the potential for acquisitive growth.
The ASX’s BEST dividend stock
Each of these three companies appear primed to reward investors with dividends and, for those focused on the long-term, capital gains. However, none of these stocks are currently in my portfolio because I think there are some (see below) ASX stocks which have even better growth prospects and dividend yields.