If you’re seeking some solid, dividend-paying, blue-chip share ideas to add to your watchlist or portfolio in 2016, you’ve come to the right place.
While not all of them may be a ‘bargain’ at today’s levels, the following five companies are at least worth a spot on every long-term investors’ watch lists.
- Telstra Corporation Ltd (ASX: TLS)
Throughout 2015, Telstra’s share price has fallen 8.63% – underperforming the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) by around 4.6%. However, for savvy investors focused on the long term, there appears much to like about holding shares in the country’s largest telecommunications company. While competition in key product groups is heating up, Telstra is transitioning into a more diversified technology company and seeking growth abroad. It also boasts a 5.7% fully franked dividend yield to boot.
- Wesfarmers Ltd (ASX: WES)
The Wesfarmers share price has outperformed the broader market in 2015, so far, and keeps ticking along nicely. The owner of Coles, Bunnings Warehouse, Officeworks and more, is a very well-run business and has a proven track record for growing its diversified portfolio of leading companies. Wesfarmers is tipped to pay a dividend of 4.9% fully franked in the next year.
- ResMed Inc. (CHESS) (ASX: RMD)
ResMed is the global biotechnology company that manufactures leading products for the treatment of sleep apnoea and a range of respiratory disorders. The company will be a net beneficiary of a lower dollar and a rebounding US economy. At their current price, ResMed’s ASX-listed shares appear good value for those focused on the long term.
- Westfield Corp Ltd (ASX: WFD)
Westfield Corp, the global arm of shopping centre giant Westfield, is another blue-chip ASX company with a global presence. In addition to paying a reliable 4.4% dividend, the $20 billion company continues to expand its network by developing new projects, such as the World Trade Centre in New York. It is also expanding existing sites, such as Century City in Los Angeles and Westfield London.
- QBE Insurance Group Ltd (ASX: QBE)
Despite its status as one of Australia’s top 20 public companies, QBE Insurance has proven to be a risky investment in times gone by. However, a stronger North American market could see QBE’s international operations finally turn a corner in 2016 and resurrect investor sentiment. The insurance giant is forecast to pay a dividend equivalent to 3.9% fully franked.
Blue-chip shares should form the foundations of any well-diversified portfolio, for a risk-averse investor. Not only do quality blue-chip companies pay reliable dividends, they can be less volatile than their smaller counterparts and should provide modest long-term capital growth. At today’s prices, I think ResMed looks the best value for those focused on the long term.