Australian and New Zealand Banking Group (ASX: ANZ), Coca-Cola Amatil Ltd (ASX: CCL) and Woodside Petroleum Limited (ASX: WPL) are three iconic businesses which many Australians hold in their long-term portfolios.
With generous dividends and international growth prospects, they appear to have a lot to offer investors. However with the stocks trading on large earnings multiples, is now the right time to buying in? Here’s what you need to know about these three blue-chip companies right now.
Outside of Australia, ANZ is growing quickly. Through its International and Institutional Banking division, earnings form Asian markets continue to grow strongly. With its Super Regional Strategy management hope to derive between 25% and 30% of revenues from markets outside Australia and New Zealand. ANZ’s growth strategy is promising, but it must be considered its shares trade on a lofty valuation and I believe it’s not a standout buy at current prices.
CCA holds exclusive rights to bottle and distribute The Coca-Cola Company’s products to Australia and a number of surrounding countries including Indonesia. CCA also has operations outside of beverages, including its tinned fruit business SPC Ardmona. However, in the past two years, its share price has fallen as a result of missed earnings guidance. Whilst this is rarely a good thing, I believe many of the catalysts for its lower-than-expected earnings are short-term in nature and have afforded long-term investors an opportunity to buy shares at a discounted price.
Woodside is a conservative capital allocator which has a reputation for taking on big projects and capitalising on their potential. Recently our biggest independent oil and gas company made the call to withdraw from the huge Leviathan gas field off the coast of Israel, freeing up funds for its share buy-back and bigger dividend payments. Whilst I feel it could offer a generous dividend payout in the coming year, its share price has become quite rich. As such I’d rate it as a ‘Hold’ at current prices.
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Each of these companies are worthy of a spot on savvy long-term investors’ watchlists. I’d rate Coca-Cola Amatil as a good buy at current prices, whilst both ANZ and Woodside appear to be fully valued.
However whilst I don’t think ANZ and Woodside are standout buys today, the good news is, if you’re looking for BIG dividend stock ideas right now, there’s one small-cap ASX stock with a 7% grossed-up dividend yield, I’m strongly consider buying, before any of the above companies!