Are you trying to escape low interest rates by buying great dividend stocks in the S&P/ASX 200 (ASX: XJO) (Index: ^AXJO)?
In this 2.25% interest rate environment, let's be honest, everybody is!
To help you out, here are five blue chip stocks you should add to your watchlist…
1. Coca-Cola Amatil Ltd (ASX: CCL) was my favourite stock idea of March. In addition to offering a dividend yield of 3.8%, partially franked, Australia's distributor of Coca-Cola and Beam branded products looks to offer compelling value for long-term investors right now.
2. Woolworths Limited (ASX: WOW) – like Coca-Cola Amatil – has had its share price sold-off in recent times, on the back of near-term profit growth concerns. However with a view to the long term, Woolies could prove to be a great investment at today's prices. Its 4.7% fully franked dividend is icing on the cake.
3. APA Group (ASX: APA) owns and operates pipelines throughout much of Australia. As our country's largest natural gas infrastructure business, APA stands to benefit from the massive increase in LNG production and exportation over the coming decade. At today's prices it's expected to yield a dividend of 4.2% in the coming year.
4. Transurban Group (ASX: TCL) is another infrastructure business with a wide economic moat (competitive advantage) which makes it a great dividend stock to own over the long term (if you can buy it at the right price, of course!). It's the owner of toll roads such as Hills M2, Citylink, Logan Motorway and more. In the year ahead analysts are forecasting Transurban to pay a dividend equivalent to 4.3%.
5. Telstra Corporation Ltd (ASX: TLS) is one of the most popular dividend stocks on the ASX. Its dominant position in a number of telecommunications markets make it a force to be reckoned with and enables it to produce enviable cash flows. With a recent share price rally, Telstra now offers a 4.83% fully franked dividend yield.
Should you buy, hold or sell?
At today's prices I do not believe all five of these stocks are a standout buy. Whilst I think each will reward shareholders over the long term, Coca-Cola Amatil and Woolworths are my two favourites moving forward.
