With the RBA looking unlikely to raise rates anytime soon, generating a decent income looks set to remain a headache for Aussie investors.
Indeed, fears of a housing bubble may be cast aside so as to retain low cash rates for longer. The downside is that this means low savings account rates for a good while yet.
With that in mind, here are three stocks that offer impressive income potential and the better security of large-cap status.
Woolworths Limited
With a fully franked yield of 4%, Woolworths Limited (ASX: WOW) is an impressive income play.
That's because Woolworths is forecast to increase dividends per share by 5.4% per annum over the next two years. This could put shares on a yield of 4.4% in 2016 (assuming no change in the company's share price), with dividends being covered 1.4 times by profit. With the company continuing to invest in prime locations across Australia, Woolworths could prove to be a strong performer with an impressive yield over the long term.
QBE Insurance Group Ltd
On the face of it, QBE Insurance Group Ltd (ASX: QBE) doesn't stand out as a great income play. That's because, while its dividends are fully franked, the stock yields just 2.9%. Furthermore, dividends are not at all covered, since the company made a loss last year.
However, the future looks much brighter for QBE. It is expected to make a profit in each of the next two years, with dividends due to increase at a rapid rate. Indeed, dividends per share are expected to be 44% higher in 2015 than they were in 2013. If met, these forecasts mean that QBE could be yielding as much as 4.3% next year.
Telstra Corporation Ltd
Shares in Telstra Corporation Ltd (ASX: TLS) currently yield a hugely attractive 5.6%.
However, Telstra is also going through a period of change. The company is aiming to expand into Asia, where it believes there is considerable long-term potential to grab market share and deliver strong earnings growth. Furthermore, with a solid position in mobile and generous revenues from the NBN takeover of Telstra's cable network, it seems to be well placed to deliver strong performance in the long run.
