The blue chips of Australia are some of the biggest companies with large market shares.
Reaching saturation point isn't great for growth and usually means the business trades on a lower price/earnings ratio.
A lower price/earnings ratio usually means a higher dividend yield, which is why the following shares could be good options for dividends:
National Australia Bank Ltd (ASX: NAB)
It's hard to look beyond one of the big four banks as a good dividend-paying blue chip.
I think NAB is the most forward-thinking big four bank and has made a lot of good steps in recent years to bolster itself such as divesting its overseas operations and working with businesses like REA Group Limited (ASX: REA).
NAB is currently trading at 13x FY18's estimated earnings with a grossed-up dividend yield of 9.03%.
Telstra Corporation Ltd (ASX: TLS)
There is a lot of potential for Telstra in the future with things like automated cars and connected homes.
The main issue has been that Telstra has been paying all of its profit out as a dividend. The NBN isn't going to help Telstra over the next few years either.
However, Telstra's plan on reducing its dividend down to an annual 22 cents per share should help a lot. This new dividend means that Telstra still has a grossed-up dividend yield of 8.9% because of the reduced share price.
Suncorp is one of the largest insurers in Australia with a multitude of brands like AAMI, Bingle and Terri Scheer.
Insurance is usually a very profitable business as long as there aren't many devastating natural events in the same year.
Suncorp is currently trading at 15x FY18's estimated earnings with a grossed-up dividend yield of 8.04%.
Foolish takeaway
Income-seeking investors wouldn't go too wrong if they chose any of the above businesses. At the current prices, I think Telstra is well worth an investment because of its beaten-up share price and high yield.
