I think these shares could have inflation-beating dividends: Centrica PLC, AstraZeneca plc, HSBC Holdings plc and Royal Dutch Shell Plc

Here’s why I think these shares may have dividend investment appeal: Centrica PLC (LON:CNA) (CNA.L), AstraZeneca plc (LON:AZN) (AZN.L), HSBC Holdings plc (LON:HSBA) (HSBA.L) and Royal Dutch Shell Plc (LON:RDSB) (RDSB.L)

HSBC Holdings plc
HSBC Holdings plc

With inflation rising to 2.9% last month, I’m taking a closer look at the dividend prospects of Centrica PLC (LON:CNA) (CNA.L), AstraZeneca plc (LON:AZN) (AZN.L), HSBC Holdings plc (LON:HSBA) (HSBA.L) and Royal Dutch Shell Plc (LON:RDSB) (RDSB.L).

Centrica has been a popular income stock for many years. I think this could increase in future as the company moves away from oil and gas activities and towards energy supply and management. I feel a more resilient business model could be on offer which makes dividend payments more predictable. With a dividend yield of 6.3% and the potential for higher profitability from cost saving measures, I’m upbeat about Centrica’s income prospects.

Shell is one of my favourite income shares at the moment. Its 6.4% yield is one of the highest I can find among large-cap shares, and with the company’s free cash flow forecast to rise I believe dividends could move higher. Sure, there is a risk from a lower oil price, but with Shell having a strong balance sheet in my view I feel it could perform well in the long run.

AstraZeneca is a company experiencing some difficulties with the loss of patents. However, it has been able to make several important acquisitions in the last few years which I feel have strengthened its profit growth potential. I like the company’s defensive qualities and feel AstraZeneca’s dividend yield of 4.3% is appealing given its long term growth prospects.

HSBC offers a dividend yield of 5.2% at the moment. Compared to some of its banking peers, that is relatively high just now. I believe the bank’s exposure to Asia could set it apart from some of its peers, since demand for financial products is likely to increase as wealth levels rise. HSBC has a solid position in a number of key Asian markets and alongside cost savings, I feel it is well-placed to be a strong dividend stock in the long term.

About Robert Stephens 3883 Articles
Robert Stephens is a CFA Charterholder and an Equity Analyst by trade. He is a passionate private investor who has been buying and selling shares for many years, owning a wide range of UK shares in the process. He has written for Citywire and The Motley Fool US and now runs his own business. To contact Robert, please email [email protected] or use one of the other contact methods available on the 'Contact Us' page