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Where I would reinvest my BHP Billiton Limited (ASX:BHP) dividends

Later today eligible BHP Billiton Limited (ASX: BHP) shareholders will receive the mining giant’s final fully franked 88.5 cents per share dividend.

While some shareholders may use this dividend as a source of income to live from, I suspect that others will look to reinvest these funds back into the share market.

Here are three shares that I would consider snapping up with these funds:

CSL Limited (ASX: CSL)

I think that this global biotech star is well worth consider after a recent pullback in its share price. Despite its vast size, I still believe CSL can grow at an above-average rate over the coming years thanks to the quality of its management team, its growing plasma collection network, strong core business, lucrative pipeline of products, and fast-growing influenza business. I feel this makes it a great candidate for a buy and hold investment.

NEXTDC Ltd (ASX: NXT)

One of my favourite tech shares on the Australian share market is this data centre operator. I believe NEXTDC is arguably the best way to gain exposure to the cloud computing boom due to its growing network of data centres in strategically important locations across Australia. Earlier this year the company announced plans to grow its capacity to a total of 300 megawatts, putting it in a great position to capture the growing demand for data storage and services. However, its shares are changing hands on a sky high earnings multiple, making them a reasonably high risk investment option.

Rural Funds Group (ASX: RFF)

Investors interested in gaining more dividends might want to consider this real estate property trust which is focused on agricultural assets. Rural Funds has a diverse and quality portfolio comprising 44 properties across six different agricultural sectors including cattle, wine, and cotton production. The properties have a weighted average lease expiry of 12.3 years, which provides stability of income and long term rental growth via a mix of indexation mechanisms. I expect this to result in growing earnings and distributions over the next few years at least. This year management plans to pay a distribution of 10.43 cents per unit, equating to a forward yield of 4.7%.

Lastly, this buy-rated share could also be a great place to invest your BHP dividend.

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Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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