SG Investor Hub Blog

Stocks to watch

Hi all,

as mentioned, my take is that noble is a share for trading only. yesterday’s rally is due to updates on its secure lines, and for a company to turn around, it takes time and other factors to be in line for the desired outcome to be successful.

currently, i am looking at :

Lifebrandz
Parkson
Sembcorp marine
mermaid Maritime

For US stocks, dividend counters such as AGNC had a very good run from 20.50 to the current high of 22.10+. The most attractive part is its monthly dividends, and at the price 22.00 and below, the dividend yield is about 10%. Yet, pls note that there is a 30% dividend tax for US counters. Thus that comes up to about 7% pa, which is paid monthly. Still a good bargain IMO.

lastly, I am available daily till 12am midnight. Feel free to text me your trade orders, and call me if i do not respond in time.

MARKET OVERVIEW
– Local shares could push higher after the Dow, S&P 500 and DAX rallied to record highs as large tech stocks reversed a spate of weakness.
– Play in tech manufacturers could return; proxies include Venture (Buy, TP: $13.35), AEM, UMS and Micro-Mechanics.
– Technically, the STI held its ground above the 20 and 50-dmas and appears to be forming a pennant pattern. A breakout of the topside resistance at 3,268 could signal the resumption of its uptrend. Immediate support lies at 3,228.

POSITIVE NEWS
*Noble Group
– Updated that the senior secured revolving credit facility at Noble Americas Corp will be extended by 120 days from 20 Jun 2017.
– Continues to be in talks with potential investors concerning the sale of an interest in the group or parts of its business.
– Discussions with bankers are continuing in relation to its revolving credit facility due May 2018. Deferred the coupon payment of its US$400m perpetual capital securities due on 26 Jun 2017.
– Expects to complete its strategic review once discussions with banks and potential investors become clearer, with results likely to include an asset realisation programme and further reduction in overhead expenses.

*SIA Engineering
– 49:51 JV with Pratt & Whitney, Eagle Services Asia, has been designated as an MRO facility in Singapore for one of two engines that power the Airbus A320neo aircraft.
– ESA will invest US$85m to equip the facility and services are expected to commence in 2019 to tap on growth opportunities arising from large orders of A320neos in the region.
– Trading at 24.1x FY3/18 consensus P/E with indicative dividend yield of 3.1%.

*Manulife US REIT
– Proposed private placement of 73.6m new units (11.7% of unit base) to institutional and other investors at US$0.817-0.842/unit.
– Bulk of the gross proceeds of up to US$80.5m (including 24.9m upsize option) is intended to part fund the US$115m acquisition of an 11-storey prime office building in New Jersey, US.
– The property will increase its total NLA by 25.9% to 2.25m sf and is underpinned by a long WALE of 9.2 years with built-in rental escalation and high occupancy of 98.9%.
– Post-deal, pro forma FY16 DPU will rise 2.3% to US$0.0363.

*Dyna-Mac
– Clinched two contracts from new customers worth a total provisional sum of $30m.
– First was awarded by Schlumberger for fabrication of a MEG reclamation unit, expected to be completed by 3Q18.
– Second is fabrication of a skid package for Papua New Guinea, expected to be completed by 2Q18.
– Group is loss-making and trades at 0.95x P/B.

*Sarine Tech
– Launched Advisor 7.0, the latest version of its industry-leading rough planning software tool.
– Updated software includes many new features that further revolutionise rough planning, helping diamond manufacturers to further streamline the planning process and optimise the polished yield.
– Trading at 24.3x trailing P/E and 5.1x P/B.

*Ley Choon
– Bagged five new contracts worth $51.4m for underground utility infrastructure and construction works.
– The contracts lift order book to $172.3m.

*Wong Fong Industries
– Collaborating with two European principals Bucher Industries and Europress to supply a range of waste management products and solutions in Singapore and Myanmar.
– Under the agreement, it will be the exclusive distributor for Bucher’s sweeper vehicles for two years till May ’19.
– The group was also appointed to develop and market waste compactors for Europress, with the first shipment to be delivered for field testing in Jul ’17.

NEUTRAL NEWS
*China Flex Packaging
– Voluntary unconditional management buyout at $1.25/share or 0.53x P/B.
– Offeror and concert parties currently own 58.4% of the loss-making plastic film manufacturer.

*Nobel Design
– Extended the offer period of its mandatory unconditional offer at $0.51/share to 20 Jun.
– As at 19 Jun, offeror Gland Slam RF18 Investments has garnered 82.51% control.

*Eurosports Global
– 51:49 JV with S Agata to distribute automobiles, parts and related accessories in Indonesia.
– S Agata is owned by a third party with business interest in the property and services sector in Indonesia.
– The group is currently loss-making and trades at 5.2x P/B.

*TIH
– Updated that discussions on the potential share sale and change of control are still on-going.
– Trading at 13.5x trailing P/E and 1.03x P/B.

*Vallianz
– Issuing 156.3m new shares at $0.02 apiece, for settlement of $3.1m in trade payables.
– This will result in NAV/share falling to US4.07¢ from US4.17¢
– Implied P/B valuation of 0.3x.

Singapore Stocks to Watch

* Singapore Premier Lee to address family feud in July 3 speech
*
Harmony Gowell (CFLX SP): Makes S$1.25/Shr cash offer for China flexible
*
Ley Choon (LEY SP): Award of contracts worth about s$51.4m
*
Manulife US REIT (MUST SP): Makes $115m purchase in New Jersey
*
Noble (NOBL SP): One of Singapore’s wildest stocks outdoes itself: Chart
*
Vallianz (VALZ SP): Reports subscription of 156.3m new shares

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Dear readers, there are 18 Singapore Reits/Trusts which are the cheapest in terms of Price-to-Book ratio: they are undervalued having a Price-to-Book ratio of less than 1 each. Let us take a look at these 18 Reits/Trusts below (note: the Price-to-Book ratio for each Reit/Trust is indicated next to the name of the Reit/Trust):

1) Fortune Real Estate Investment Trust 0.7

2) Far East Hospitality Trust 0.75

3) Sabana Shari’ah Compliant Industrial Real Estate Investment Trust 0.75

4) Ascott Residence Trust 0.75

5) Keppel REIT 0.76

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