Yahoo Finance 3 Singapore Blue-Chip Stocks That You Can Buy and Pass Down to Your Children
Blue-chip stocks make a great addition to any investor’s portfolio.
Their strong reputation, sterling track record and ability to weather economic cycles make them ideal candidates for a resilient investment portfolio.
Of course, you need to be discerning when selecting appropriate blue-chip stocks to own for years or even decades.
These businesses need to be able to stand the test of time and can qualify as stocks you are happy to pass down to the next generation.
Here are three solid blue-chip names that you can safely pass down to your children.
DBS Group (SGX: D05)
DBS is no stranger to Singaporeans, being Singapore’s largest bank by market capitalisation.
The lender has been through numerous economic cycles but has still come out strong.
Investment firm Temasek Holdings owns a 29% stake in DBS Group as of 7 February 2024.
The bank reported a strong set of earnings for 2023 on the back of a sharp rise in net interest margins.
Surging interest rates over the past two years helped to lift the group’s net interest income (NII).
NII jumped 33% year on year for 2023 to S$14.3 billion with total income climbing by 22% year on year to S$20.2 billion.
Net profit increased by 23% year on year to S$10.1 billion, a record high.
In line with the strong results, DBS declared a final dividend of S$0.54, 26% higher than the S$0.42 paid out a year ago.
For 2023, the bank’s total dividend stood at S$1.92.
A 1-for-10 bonus issue was also announced that will be eligible for 2024’s first quarter dividend.
CEO Piyush Gupta is sanguine about 2024.
He maintains the net interest margin guidance to be around 2023 levels as it will be supported by DBS’s Citigroup (NYSE: C) Taiwan acquisition.
Fee income is also expected to rise by double-digits year on year for 2024.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
The group enjoys a natural monopoly by being the only bourse operator in the country.
SGX reported a solid set of earnings for its fiscal 2023 (FY2023) ending 30 June 2023.
Revenue rose 8.7% year on year to S$1.2 billion while net profit jumped 26.5% year on year to S$570.9 million.
Excluding one-off items, net profit increased by 10.3% year on year to S$503.2 million.
SGX upped its quarterly dividend from S$0.08 to S$0.085.
The group continued its momentum for the first half of fiscal 2024 (1H FY2024).
Revenue inched up 3.6% year on year to S$592.2 million.
Net profit, however, dipped by 1% year on year to S$281.6 million. Excluding one-off items, net profit would have increased by 6.2% year on year to S$251.4 million.
The outlook remains bright for SGX as it strives to strengthen its global distribution capabilities and foster deeper relationships with partners.
The bourse operator intends to maintain a single-digit % year-on-year growth in its dividend per share, subject to earnings growth.
Singapore Technologies Engineering Ltd (SGX: S63)
Singapore Technologies Engineering, or STE, is a technology, defence, and engineering group that serves customers in the aerospace, smart city, defence, and public security segments.
The group serves customers in more than 100 countries.
STE is nearly 50% owned by Temasek Holdings, making it a solid and dependable investment.
The engineering giant also reported a splendid set of earnings for 2023.
Revenue rose 11.8% year on year to S$10.1 billion.
Operating profit jumped 24.4% year on year to S$914.7 million.
Net profit increased by 9.6% year on year to S$586.5 million but was affected by one-off items.
Removing these items, net profit would have grown by 24% year on year to S$610 million.
STE saw revenue rise across all three of its segments if the US Marine business was excluded.
A total of S$14.8 billion in new contracts were secured for 2023, taking the group’s order book to S$27.4 billion as of 31 December 2023.
A final dividend of S$0.04 was declared, bringing 2023’s dividends to S$0.16, in line with 2022’s dividends.
STE is seeing good traction from its TransCore acquisition as earnings are flowing in faster than planned.
Meanwhile, the Satcom sub-division is also transforming.
The group continues to make investments for capacity expansion and to build more capabilities.
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Disclosure: Royston Yang owns shares of DBS Group and Singapore Exchange Limited.
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