ASX blue-chip shares can be some of the most appealing options for dividends because of the stability and sizeable dividend yield they can provide.
But there are more blue-chips available to Australians than just the biggest names, such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA) and CSL Ltd (ASX: CSL).
I think there are a few names out there that can provide a more appealing combination of dividend yield and growth than the most popular stocks like CBA and BHP, like the two below.
Charter Hall Long WALE REIT (ASX: CLW)
This first ASX share is a real estate investment trust (REIT) that’s invested in an array of different types of commercial property, including government entities (such as Geoscience Australia), telecommunication exchanges, data centres, service stations, hotels/pubs and others.
No other ASX REIT can provide investors with that much diversification under a single investment.
By investing in so many areas, it can protect investors from being too invested in one particular area, while many other REITs are focused on shopping centres, office buildings, or other areas.
One of the main attractions of this ASX blue-chip share is that it has a very long weighted average lease expiry (WALE), meaning the rental income is locked in for a long time. Currently, the REIT has a WALE of around nine years, which is a long time for the sector.
Additionally, that income is regularly growing thanks to rental escalation built into the rental contracts. Some of the portfolio has fixed annual indexation, while the rest of the portfolio has inflation-linked rental increases. This helps support and grow distributions.
It plans to pay a distribution of 25.5 cents per unit in FY27, equating to a distribution yield of 7.4%. That’s a great starting yield, in my view.
Australian United Investment Company Ltd (ASX: AUI)
The other ASX blue-chip I want to highlight is this listed investment company (LIC) which was founded in 1953. So, it has already been going for more than 70 years.
It aims to provide investors with exposure to a quality portfolio of ASX shares, as well as an international investment portfolio, held mainly through international-focused funds.
The goal is to provide shareholders with a portfolio that can provide income and capital appreciation over the medium-to-long-term.
Currently, its biggest positions include CBA, BHP, Rio Tinto Ltd (ASX: RIO), Transurban Group (ASX: TCL), ANZ Group Holdings Ltd (ASX: ANZ), Wesfarmers Ltd (ASX: WES), Westpac Banking Corp (ASX: WBC), CSL Ltd (ASX: CSL) and Washington H. Soul Pattinson and Co. Ltd (ASX: SOL).
It’s also invested in multiple Vanguard funds that give it exposure to the global share market, which I think is a useful factor.
With an annual management expense ratio (MER) of just 0.10%, which I’d describe as one of the cheapest ASX share investment portfolios on the ASX.
The ASX blue-chip share has steadily grown its dividend payout over the long-term and maintained the dividend when it hasn’t hiked the payout.
It has paid an annual dividend per share of 45 cents in recent financial years, which translates into a grossed-up dividend yield of 5.3%, including franking credits.
The post 2 ASX blue-chip shares offering big dividend yields appeared first on The Motley Fool Australia.
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Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Transurban Group, Washington H. Soul Pattinson and Company Limited, and Wesfarmers. The Motley Fool Australia has positions in and has recommended Transurban Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended BHP Group, CSL, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.