The ASX 200 closed at record high today backed by some positive earnings announcements once again. The index gained 0.5% and closed at 7628.9 points. Healthcare sector was the best performer of the day with a 1.9% gain. Consumer discretionary also performed well as Premiere Investments gained 4.9%.
With growth stalling in the markets, and the ASX having plenty of dividend stocks to pick from, the earnings season has been buoyant. The miners have been the pick of the bunch when it comes to dividends and here are the top blue chip dividend stocks to consider buying.
BHP Group is arguably the most well diversified mining and exploration company there is, and it is a part of every investor’s portfolio for different reasons – maybe for the stable dividends, or to decrease the overall volatility of the portfolio. BHP shares are also one of the best blue chip stocks that trade on the ASX. BHP derives revenues from 4 main commodities – Iron Ore, Copper, Coal, and Petroleum. These commodities are very sensitive to the global economic outlook and activity. With economic activity increasing across the developed world, increased demand and inflation fears have resulted in high commodity prices. BHP shares are trading close to its highs posted earlier this year on the back of soaring iron ore prices.
On the back of sky high commodity prices, BHP’s profits will most likely soar once again for full year FY21, just as it did in the half year earnings, resulting in a very healthy dividend payout once again – making BHP shares one of the best income stocks on the ASX.
BHP shares currently trade at $52.81 a share with a dividend yield of 4% – a top dividend share to buy now on the ASX given the impending stellar earnings that BHP is expected to post next week!
Just like BHP, Coles have their earnings coming up later next week as well. COL shares plunged in February, the stock has rebounded exceptionally well. COL shares have returned over 12% in the last 3 months and the COL share price is on an upward trajectory. The rebound has been largely due to normalising consumer behaviour and Coles cycling the significant impacts of Covid19. In the third quarter update, Supermarkets sales decreased by 6.1%. Liquor and Express sales increased by 2.6% and 7.4% respectively. Early signs of normalising consumer behaviour were observed including improved transaction growth, a recovery of COVID-19 impacted categories such as impulse, convenience and food-to-go, and Sunday returning to be the busiest trading day of the week. With inflation being a matter of when rather than if, consumer staples with pricing power such as Coles is a good place to be as the firm can pass on the added cost to consumers. Consumers still have to buy groceries!
COL shares currently trade at $18.4 a share with a dividend yield of over 3.3%. With a positive earnings expectation and inflation not really affecting Coles as much as other sectors, the forecast for FY22 should be positive as well – setting COL shares up nicely as a top dividend stock to consider.
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