5 Value Stocks with the Best Yields in Singapore, According to the FTSE Value-Stocks ASEAN Index
The FTSE Value-Stocks ASEAN Index promises to curate a group of high quality value stocks from the ASEAN region.
Using a proprietary screening process, the index sieves out 50 select companies from the Indonesia Stock Exchange, Bursa Malaysia, the Philippine Stock Exchange, the Singapore Exchange, and the Stock Exchange of Thailand. The key value factors considered are the price-to-earnings (PE) ratio, the dividend yield, return on equity, operating profit margin, net gearing, and what the index calls a unique contrarian factor.
Thankfully, a recent report from local bourse operator SGX provided more insight into the FTSE Value-Stocks ASEAN Index. It turns out that there are 10 Singapore-listed companies made the cut for the index. From there, we picked out five Singapore-listed stocks in the index that sport the highest dividend yields (figures as of 13 Aug 2018, unless otherwise stated):
1. Mapletree Logistics Trust (SGX: M44U) tops the list with a distribution yield of 6.2%. The real estate investment trust (REIT), which focuses on logistics properties in the region, has delivered a total return of almost 260% since October 2010. Mapletree Logistics Trust trades at price-to-book (PB) ratio of 1.0 and has a market cap of just over S$4 billion.
2. Another Mapletree entity, Mapletree Industrial Trust (SGX: ME8U), is in second place with a distribution yield of 6%. The Singapore-focused industrial REIT delivered a total return of 255% over the past decade, and weighs in at a market cap of S$3.7 billion. Mapletree Industrial Trust units trade at 1.3 time its book value.
3. Ascendas Real Estate Investment Trust (SGX: A17U) comes in at a close third with a distribution yield of 5.8%, making it the third REIT to make our list. It has a market cap of almost S$8 billion and trades at an affordable PB ratio of 1.3. The REIT’s total 10-year return amounts to 120%.
4. Further down the list is Singapore Telecommunications Limited (SGX: Z74). Singapore’s biggest telco offers a 5.6% dividend yield, and has delivered around 48% in total returns over the past decade. The firm trades at just 9.5 times earnings right now, suggesting that its shares might be cheap. You can read more about Singtel here.
5. Rounding up the top five is DBS Group Holdings Limited (SGX: D05), or DBS Group for short. In 2017, the Asian-focused bank paid out a sizable dividend of 93 cents per share, excluding special dividends. At the moment, shares offer a dividend yield of 4.7%. DBS Group also posted total returns of 140% over the past 10-years.
The five stocks above offer attractive dividend yields. All but one has also delivered over 100% returns over the last 10-years. But as investors, our work is not done. While history provides hints, we should always look to forward to determine if the companies of today can provide the returns we are looking for tomorrow.