Yahoo Finance 4 Stocks I Will Buy Now if I Had S$20,000
A good mental exercise that investors can undertake is to simulate which stocks you would buy should you start from scratch with a sum of money..
Going through such a process helps to tease out your best buys at a specific point in time.
It also helps your mind to filter out weaker investment ideas to focus on the best ideas.
In a nutshell, this seemingly simple simulation assists in narrowing down your list of potential investment options and provides you with a ready watchlist of stocks to select from.
I’ve used such exercises to good effect, too, by imagining how I would deploy S$20,000.
My investment style seeks a healthy mix of both growth and dividends.
Here are four stocks I plan to buy if I had this tidy sum of money.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
The group operates a platform for the buying and selling of securities such as shares, bonds and derivatives.
The bourse operator has announced promising initiatives to grow its business over time.
Some of these include the launch of the world’s first ESG REIT derivatives last month to meet rising demand from investors for the inclusion of ESG considerations into their portfolios.
SGX is also allowing bond issuers in Asia Pacific to showcase their green, social and sustainability bonds to global investors by partnering with Nasdaq Inc (NASDAQ: NDAQ).
The group also recently inked a partnership with Platts, a unit of S&P Global Inc (NYSE: SPGI), to provide commodities data and content.
It’s encouraging to note that SGX has laid out a comprehensive plan for its revenue to grow by high single-digits in the medium term.
Coupled with an S$0.08 quarterly dividend, the exchange looks poised to deliver both growth and a decent yield to boot.
Sheng Siong Group Ltd (SGX: OV8)
Sheng Siong is one of the largest supermarket chains in Singapore and operates a total of 63 outlets in Singapore and three in China.
The group offers a wide range of merchandise from live and chilled seafood to toiletries and essential household items.
Last year, Sheng Siong enjoyed a strong revenue and profit boost from the pandemic as more people telecommuted and studied from home.
Revenue grew 40.6% year on year while net profit surged by 83.7% year on year to S$139.1 million.
The supermarket chain also paid out a total dividend of S$0.065 in 2020.
The momentum has carried over to the first quarter of 2021 (1Q2021) as well.
Revenue inched up 2.7% year on year while net profit climbed 6.5% year on year for 1Q2021.
Meanwhile, the group just announced the signing of a new lease agreement to open its third store in Kunming, China.
With telecommuting being the new normal, Sheng Siong should continue to see elevated demand for its products.
Mapletree Industrial Trust (SGX: ME8U)
The inclusion of Mapletree Industrial Trust, or MIT, in my list of stocks to buy, is timely as the REIT had just concluded a major acquisition in May by adding a portfolio of 29 data centres spread out across 18 US cities.
As of 31 March 2021, MIT’s portfolio comprises 87 industrial properties in Singapore and 28 properties in the US.
The portfolio was worth around S$6.8 billion.
The REIT had reported a robust set of numbers for its fiscal year 2021 ended 31 March 2021.
Gross revenue rose 10.2% year on year to S$447.2 million, boosted by the inclusion of 14 data centres in the US.
Distribution per unit, meanwhile, inched up 2.5% year on year to S$0.1255, an admirable achievement considering the REIT manager had to dole out rental reliefs to tenants during the fiscal year.
Moving forward, the REIT’s revenue and distributable income should rise as it incorporates its most recent acquisition into its growing portfolio of properties.
Micro-Mechanics (Holdings) Ltd (SGX: 5DD)
Micro-Mechanics Holdings, or MMH, designs and manufactures high-precision tools and parts used for the wafer fabrication and assembly processes in the semiconductor industry.
The group posted a record set of numbers for the nine months ended 31 March 2021 (9M2021).
Revenue jumped by 14.1% year on year to S$54.6 million while net profit climbed by 24% year on year to S$13.3 million.
MMH also had cash of S$16.4 million with no debt on its balance sheet.
The group is reporting healthy numbers despite the severe semiconductor shortage now as supply chains are impacted by the pandemic.
Although it may suffer from a short-term crunch, the long-term outlook is healthy as the World Semiconductor Trade Statistics has forecast an 8.4% year on year growth in the global semiconductor market in 2021.
MMH also paid out an interim dividend of S$0.06 recently, and its trailing 12-month dividend stands at S$0.13.
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Disclaimer: Royston Yang owns shares of Singapore Exchange Limited and Micro-Mechanics (Holdings) Ltd.
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