At the current Telstra Corporation Ltd (ASX: TLS) share price and National Australia Bank Ltd. (ASX: NAB) share price, big dividend yields are on offer.
NAB dividend and Telstra dividend
The graph above shows the NAB and Telstra dividend yields versus the average of companies included in the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO). At can be seen, the yields from these two blue chips are impressive.
NAB
NAB shares have flown 27% higher over the past year as investors fell over themselves to get a slice of the recovering financial heavyweight. Over the past two years, NAB has offloaded some of its struggling international assets and is now focused on the local Australian and New Zealand markets.
Telstra
Telstra is facing a few headwinds at the moment and the market doesn't like it. The rise of Optus, TPG Telecom Ltd (ASX: TPM), Vocus Group Ltd (ASX: VOC), higher interest rates and the rollout of the NBN has the market wondering where Telstra will turn to for its growth. However, there are a lot of good businesses under the Telstra banner. And although it may be set to lose more fixed broadband business as the industry gets more competitive, it has a dominant mobile business and receives payments from the NBN Co.
Foolish Takeaway
Call me greedy but I would like a lower share price before buying into either Telstra or NAB shares. I think both companies have a lot going for them but their current share prices reflect their potential.
Nonetheless, I have them on my watchlist and will be keeping a close eye on their dividends throughout 2017.
