Insights

3 Hong Kong Blue-Chip Stocks Yielding Over 5%

Looking for solid blue-chip stocks to buy that have high dividend yields? Here are three dividend stocks investors should know about. – Dividends note with money and calculator

Income investors love to invest in companies that can pay sustainable dividends over long periods. Moreover, they would love to buy these stocks when they are trading at a high dividend yield.

Here, I’ll look at three blue-chip companies that are trading at more than 5% dividend yield, much higher than the market average’s dividend yield of around 3%.

For the market, I’m using SPDR Straits Times Index ETF as a proxy for market average.

The leading local bank

The first company that I will explore here is Hang Seng Bank (SEHK: 11). For starters, Hang Seng Bank is one of the leading banks in Hong Kong.

It is part of the HSBC Holdings plc (SEHK: 5), which holds a majority equity interest of 62.14% in the bank. Unlike HSBC, however, Hang Seng Bank focuses its business mainly in Hong Kong, as well as in mainland China.

In the last 12 months, the stock has declined by 35% thanks to the protests and the recent Covid-19 outbreak. At HK$129 (at the time of writing), the stock is trading at an attractive trailing dividend yield of 6.4%.

In the last decade, Hang Seng Bank grew its dividend per share (DPS) from HK$5.20 in 2009 to HK$8.20 in 2019, up by 58% during that period.

In the near term, the Covid-19 outbreak will have an impact on the bank’s performance. Still, investors with a longer time horizon may want to look into the stock now given its high dividend yield.

The major oil player

The next company here is one of China’s three leading oil and gas companies, China Petroleum & Chemical Corp (SEHK: 386), or better known as Sinopec.

Similar to Hang Seng Bank, Sinopec’s share price has fallen significantly in the last 12 months, down by 36% to HK$ 3.37. Based on its trailing annual dividend payment of RMB 0.31 (HK$0.34), the company is trading at a yield of about 10%.

One thing to like about Sinopec is the strong dividend track record over the last decade, during which the company raised its DPS from RMB 0.18 in 2009 to RMB 0.31 in 2019, or up by 72%.

On the downside, there is a risk that the company might reduce dividend payments in the short term given the low oil price and impact from the Covid-19 outbreak. Still, investors have a good margin of safety here thanks to its solid dividend track record and high dividend yield.

The global manufacturer

The last company here is Vtech Holdings Ltd (SEHK: 303), a global supplier of electronic learning products from infancy to preschool, and also the leading manufacturer of cordless phones based in Hong Kong.

Like the two other companies, Vtech is trading at a high dividend yield of more than 9% after its stock fell by 46% from its 12-month high of HK$ 43.90.

Investors are generally staying away from the stock as they worry about the impact of Covid-19 on its business.

Still, I like the company because it has been paying dividends for more than 15 years in a row. In 2003, it paid a DPS of US$0.035. Since then, it has grown its dividend to US$0.67 in 2019, which is a compound annual growth rate (CAGR) of 21.7%.

Foolish takeaway

There you go, three companies with an above-market-average dividend yield.

Though all three companies are currently facing challenges stemming from the COVID-19 outbreak, they should be able to recover over the long term.

Hence, investors may want to learn more about these stocks given their high dividend yield.

More reading

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Hong Kong contributor Lawrence Nga doesn’t own shares in any companies mentioned.

The Motley Fool Hong Kong Limited(www.fool.hk) 2020

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!