The S&P/ASX 200 Index (ASX: XJO) and All Ordinaries (ASX: XAO) remain in a vulnerable (and volatile) state and may present more buying opportunities in the future.
For investors seeking high quality ASX 200 dividend shares with consistent cash flows amid the COVID-19 crisis, here are 3 blue-chip shares to add to your watchlist.
BHP Group Ltd (ASX: BHP)
The iron ore spot price has soared to an 11-month high following strong Chinese steel demand and optimism over Chinese economic growth recovery. This spells good news for iron ore miners BHP, Rio Tinto Limited (ASX: RIO) and Fortescue Mining Limited (ASX: FMG), all of which are among the best ASX 200 dividend shares, in my view.
I would prefer BHP as the dividend play, given its diversified minerals portfolio compared to a pure iron ore play such as Fortescue. At the time of writing, BHP pays a fully franked dividend yield of 5.76%. The current elevated iron ore prices should see iron ore miners continue to be leading ASX 200 dividend shares for yield-hungry investors.
WAM Capital Limited (ASX: WAM)
On 8 July, WAM Capital announced a fully franked final dividend of 7.75 cents per share, bringing its FY20 fully franked full year dividend to 15.5 cents per share. This would equate to a dividend yield of approximately 8.1% at today’s share price.
Its market leading dividend payout follows its investment portfolio outperforming the ASX 200 by 4.4% during the 12-month period to 30 June 2020. WAM Capital’s top holdings as at 30 June 2020 include retailers such as Adairs Ltd (ASX: ADH), Bapcor Ltd (ASX: BAP) and BWX Ltd (ASX: BWX) and a mix of others in agriculture, healthcare and information technology.
WAM hasn’t cut its dividend for more than a decade and remains one of the most consistent and reliable ASX 200 dividend shares.
JB Hi-Fi Limited (ASX: JBH)
Retailers are emerging as strong ASX 200 dividend shares, given an increase in retail spending and time spent at home. As a result, JB Hi-Fi reported strong sales growth in the second half of FY20 in JB Hi-Fi Australia and The Good Guys with comparable sales increasing by 20% and 23.5%, respectively, on the prior corresponding period (pcp).
At this point in time, the group expects total net profit after tax to be in the range of $300 million to $305 million, an increase of 20% to 22% on the pcp. It currently pays a dividend yield of approximately 3.80%. Other retailers such as Adairs and Shaver Shop Group Ltd (ASX: SSG) may pay higher dividends, but I prefer JB Hi-Fi for its position as a market leader in the electronics space, and its consistent earnings.
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More reading
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- Is the gold price too high for investing in ASX gold shares?
- 2 ASX shares I would buy for growth and income
- The difficulty of investing in shares right now
- Why the Fortescue share price rallied over 40% to a record high in 2020
Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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