Are these the best blue chips shares on ASX? [2023]
Investing in blue chip shares can be a great way to build a stable and diversified portfolio. Get to know 10 of the top ASX blue chip companies.
What is a blue chip stock?
A blue chip stock is a stock of a well-established and financially stable company with a history of consistent growth and a strong track record of performance. These companies have a large market capitalisation, high liquidity, and a reputation for paying dividends. They are considered to be less risky investments than other stocks and are often found in major indices such as the ASX 200.
Blue chip stocks are typically from mature industries and have a strong market position, such as well-known brands and a reputation for quality products or services. They are often considered as a bellwether for the overall market and are considered to be a safe investment option.
✅ Interested in Wall St? Discover our list of the top U.S. blue chip stocks
Discover the top blue chip shares on ASX
Company Name | Ticker | Stock Price | Year to Date | Market Capitalisation |
|---|---|---|---|---|
Commonwealth Bank of Australia | $108.05 | +4.16% | $182b | |
BHP Group Limited | $69.38 | +12.67% | $175b | |
Rio Tinto Limited | $78.76 | +10.88% | $129b | |
National Australia Bank Limited | $31.34 | +4.05% | $98b | |
Westpac Bank Corporation | $23.65 | +1.15% | $82b | |
ANZ Group Holdings Limited | $24.62 | +4.32% | $73b | |
Woodside Energy Group Ltd | $37.75 | +5.89% | $71b | |
Wesfarmers Limited | $49.16 | +6.82% | $55b | |
Telstra Group Limited | $4.09 | +2.76% | $47b | |
Insurance Australia Group Limited | $5.06 | +6.08% | $12b |
Data as of 24 January 2023. Source: Stake, Google Finance.
*The list of shares mentioned is ranked by market capitalisation. When deciding what assets to feature, we analyse the dividend yield, financials, recent news, the state of the industry, and whether or not they are actively traded on Stake.
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Decide which are the best ASX blue chip stocks to watch
1. Commonwealth Bank of Australia ($CBA)
Market Capitalisation: $182b
Stock price (as of 24/01/2023): $108.05
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 67% / 33%
Commonwealth Bank of Australia is one of the largest financial services companies in Australia. Founded in 1911, the bank provides a range of banking and investment products and services, including personal banking, business banking, corporate banking, and institutional banking.
🆚 Compare CBA vs WBC→
🆚 Compare CBA vs ANZ→
2. BHP Group Limited ($BHP)
Market Capitalisation: $175b
Stock price (as of 24/01/2023): $69.38
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 74% / 26%
BHP Group is one of the largest mining and resource companies in the world. Founded in 1885 as the Broken Hill Proprietary Company, it operates in a variety of sectors, including oil and gas, copper, iron ore, coal, and nickel. It is a diversified company with operations in Australia, North America, South America, Africa, and Asia. BHP Group is known for its commitment to sustainability, with a focus on reducing greenhouse gas emissions and improving safety and health.
3. Rio Tinto Limited ($RIO)
Market Capitalisation: $129b
Stock price (as of 24/01/2023): $78.76
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 68% / 32%
Rio Tinto is a multinational mining company founded in 1873, which operates in more than 35 countries worldwide. The company produces a variety of metals and minerals, including aluminium, copper, diamond, gold, and iron ore. Rio Tinto is known for its strong commitment to sustainable mining, with a focus on reducing water usage, carbon emissions and improving the lives of the communities in which it operates.
4. National Australia Bank Limited ($NAB)
Market Capitalisation: $98b
Stock price (as of 24/01/2023): $31.34
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 63% / 37%
National Australia Bank (NAB) is one of the four major banks in Australia. It offers a wide range of banking and financial products and services to customers, including personal banking, business banking, corporate banking, and institutional banking. NAB is known for its strong presence in the Australian market and its focus on providing services to small and medium-sized businesses.
5. Westpac Banking Corporation ($WBC)
Market Capitalisation: $82b
Stock price (as of 24/01/2023): $23.65
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 65% / 35%
Westpac Banking Corporation is a financial services company that was founded in 1817. The company offers a range of banking and investment products and services across the financial industry, ranging from retail to institutions and corporations.
💡Related: Which are the best ASX bank shares to invest in?→
6. ANZ Group Holdings Limited ($ANZ)
Market Capitalisation: $73b
Stock price (as of 24/01/2023): $24.62
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 70% / 30%
ANZ Group Holdings Limited (ANZ) is one of the largest banks in Australia and New Zealand. It offers a wide range of banking and financial products and services to customers, including personal banking, business banking, corporate banking, and institutional banking. ANZ is known for its strong presence in the Asia-Pacific region, with a focus on providing services to large corporate and institutional customers.
🆚 Compare ANZ vs NAB→
🆚 Compare ANZ vs WBC→
7. Woodside Energy Group ($WDS)
Market Capitalisation: $71b
Stock price (as of 24/01/2023): $37.75
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 55% / 45%
Woodside Petroleum is an oil and gas exploration and production company that was founded in 1954. The company operates in a variety of regions, including Australia, Africa, Asia, and the Americas. Woodside Energy produces over 200 million barrels of oil equivalent (BOE) per year, including both oil and natural gas production.
8. Wesfarmers Limited ($WES)
Market Capitalisation: $55b
Stock price (as of 24/01/2023): $49.16
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 77% / 23%
Wesfarmers is a retail company that was founded in 1914. The company operates a variety of retail chains, including Coles, Bunnings, and Kmart. Wesfarmers operates more than 2,500 retail stores, including supermarkets, home improvement stores, and department stores across the two countries. This includes over 2,400 Coles supermarkets, over 400 Bunnings Warehouse home improvement stores and over 100 Kmart, Target and Officeworks stores.
9. Telstra Group Limited ($TLS)
Market Capitalisation: $47b
Stock price (as of 24/01/2023): $4.09
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 63% / 37%
Telstra Corporation is a telecommunications company that was founded in 1975. The company provides a range of services, including mobile, internet, and phone. Telstra is committed to delivering world-class connectivity and digital solutions to customers all across the country.
10. Insurance Australia Group Limited (IAG)
Market Capitalisation: $12b
Stock price (as of 24/01/2023): $5.06
Stake Platform Bought / Sold (1 Jan 2022 - 24 Jan 2023): 54% / 46%
Insurance Australia Group (IAG) is an Australian-based insurance company that provides a wide range of insurance products and services, including personal insurance, business insurance, and specialised insurance services. IAG is known for its strong presence in the Australian and New Zealand markets and its focus on providing services to individuals and businesses.
How to buy blue chip shares in Australia?
There are a few ways to buy blue chip shares in Australia:
- Buying shares through a brokerage account: You can open a brokerage account with a stockbroker or online brokerage firm to buy and sell blue chip shares. Open your account on Stake.
- Use a self-managed super fund (SMSF): If you have an SMSF, you can use it to buy blue chip shares in Australia. You will need to set up a brokerage account for your SMSF and then use it to make trades.
- Buy an exchange-traded fund (ETF): ETFs allow investors to gain exposure to a basket of diversified securities with the ease of needing to invest in a single asset. There are plenty of blue chip stock ETFs listed on the ASX.
Which Australian blue chip shares have good dividends?
Some Australian blue chip shares that have a history of paying good dividends include:
Commonwealth Bank of Australia ($CBA) - A financial services company that has a long history of paying dividends and has a current dividend yield of around 4.2%.
Westpac Banking Corporation ($WBC) - A financial services company that also has a long history of paying dividends and has a current dividend yield of around 6.0%.
National Australia Bank ($NAB) - A financial services company with a current dividend yield of around 5.2%.
Telstra Group Limited ($TLS) - A telecommunications company that has a current dividend yield of around 4.2%.
Wesfarmers Limited ($WES) - A retail company with a current dividend yield of around 4.2%
💡Related: Are these the best dividend stocks on ASX?→
💡Related: Check out 10 high dividend ETFs in Australia→
Summary:
- Blue chip shares are considered to be a good investment due to their financial stability and strong track record of performance. These Australian stocks are often found in major indices such as the S&P/ASX 20 or S&P/ASX 50, and are considered to be less risky than other stocks.
- The Australian Securities Exchange (ASX) offers a wide range of blue chip stocks across different sectors, such as financial services, mining, and telecommunications, which can provide investors with diversification opportunities.
- Investing in blue chip shares can also provide investors with a steady stream of dividends, as many blue chip companies have a history of paying dividends to shareholders. This can provide investors with a flow of income in addition to any potential capital gains from the appreciation of the stock price.
More resources:
✅ Discover the top U.S. blue chip stocks→
✅ Are these the best dividend REIT stocks on Wall St?→
✅ Are these the best ETFs to buy and hold in Australia?→
Blue chip shares FAQs
Blue chip stocks are generally considered to be a good investment due to their financial stability and strong track record of performance. They are considered to be less risky investments than other stocks and are often found in major indices such as the ASX 200.
It's important to note that investing in blue chip stocks, like any other investment, carries some level of risk, and past performance is not a guarantee of future results.
There is no exact way to define a stock as a blue chip, but there are some factors to consider, including but not limited to:
- Market capitalisation: Blue chip stocks typically have a large market capitalisation, meaning they are worth a significant amount of money.
- Financial stability: Blue chip companies tend to have a strong financial track record, with consistent earnings and revenue growth, and low debt levels.
- Reputation: Blue chip companies are usually well-known brands with a reputation for quality products or services.
- Dividend history: Blue chip companies tend to have a history of paying dividends to shareholders, which can be a sign of financial stability and profitability.
- Industry: Blue chip stocks are often from mature industries, such as healthcare, financial services, or consumer goods.
- Stock performance: Blue chip stocks tend to have a strong performance history, with steady or increasing stock prices over time.
There are several Australian ETFs made up of blue chip stocks listed on the Australian Securities Exchange (ASX) that allow investors to invest in a diversified portfolio. Some examples include:
- iShares S&P/ASX 200 ETF ($IOZ) - Tracks the performance of the S&P/ASX 200 index, which is made up of the 20o largest and most liquid companies listed on the ASX.
- SPDR S&P/ASX 50 Fund ($SFY) - Tracks the performance of the S&P/ASX 50 index, which is made up of the 50 largest companies listed on the ASX.
- VanEck Vectors Australian Banks ETF ($MVB) - Tracks the performance of the S&P/ASX 200 Financials (ex A-REIT) index, which includes the largest and most liquid financial companies listed on the ASX.
- BetaShares Australian Dividend Harvester Fund ($HVST) - Aims to track the performance of the S&P/ASX Dividend Opportunities Index, which is made up of companies listed on the ASX that have a history of paying dividends.
It's always important to read the ETF's product disclosure statement (PDS) before investing, as it contains important information about the ETF's investment objectives, risks, fees and expenses.
This does not constitute financial product advice nor a recommendation to invest in the securities listed. Past performance is not a reliable indicator of future performance. As always, do your own research and consider seeking appropriate financial or taxation advice before investing.
Stella is a markets analyst and writer with almost a decade of investing experience. With a Masters in Accounting from the University of Sydney, she specialises in financial statement analysis and financial modelling. Previously, she worked as an equity analyst at Australian finance start-up, Simply Wall St, where she took charge of the market insights newsletter sent out to over a million subscribers. At Stake, Stella has been key to producing the weekly Wrap articles and social media content.
