Yahoo Finance Forget Stablecoins and Luna: These 3 Blue-Chip Companies Offer Both Stability and Dividends
The last two weeks have been tough for cryptocurrency investors, especially those who had bought both Luna and TerraUSD.
TerraUSD, a stablecoin that was pegged to the US dollar, crashed to US$0.20 last Wednesday and is now trading at around US$0.095.
Its affiliate token Luna has lost nearly all its value in a stunning plunge from an all-time high of US$119.18 just last month.
If you’re troubled by the sudden and inexplicable crash in these two cryptocurrencies, don’t fret.
You can always choose to park your money in dependable blue-chip companies that offer peace of mind as well as dividends.
Singapore Technologies Engineering Ltd (SGX: S63)
Singapore Technologies Engineering Ltd, or STE, is a defence and engineering conglomerate with three business segments — commercial aerospace, urban solutions & satcom (satellite communication), and defence & public security.
The group has operations spanning across Asia, Europe and the US serving customers in more than 100 countries.
STE reported a respectable set of results for its fiscal 2022 first quarter (1Q2022) business update.
Group revenue rose 13% year on year to S$2 billion, equalling the level achieved two years ago before the pandemic.
All its three divisions enjoyed year on year revenue increases, with aerospace leading the pack with a 22% year on year jump.
A total of S$2.4 billion in new contracts was secured during 1Q2022, bringing STE’s order book to a two-year high of S$21.3 billion.
The board has also approved STE’s quarterly dividend of S$0.04 per share, taking the annualised dividend per share to S$0.16.
At a share price of S$4.04, the conglomerate’s shares offer a forward dividend yield of 4%.
OCBC Ltd (SGX: O39)
OCBC needs no introduction, being one of Singapore’s three big banks.
The group has stood resilient throughout the pandemic, and recently announced a mixed set of earnings for 1Q2022.
Its net interest income (NII) continued to rise year on year to S$1.5 billion but total non-interest income took a hit from lower trading income and decreased profits from the bank’s life insurance arm.
Despite the weaker showing, the bank looks poised to enjoy a strong NII uplift from rising interest rates.
Higher rates will push up the net interest margin, which in turn will boost OCBC’s NII.
The lender paid out a total dividend of S$0.53 per share for fiscal 2021 (FY2021), giving its shares a trailing dividend yield of 4.5%.
The bank should continue to do well with the recovery of Asian economies and could see its net profit and dividend rising in the quarters ahead.
Ascendas REIT (SGX: A17U)
Ascendas REIT, or A-REIT, is an industrial REIT that owns a total of 220 properties worth around S$16.4 billion as of 31 March 2022.
These properties are spread out across four regions — Singapore, Australia, the US, and the UK/Europe.
A-REIT has seen a strong rebound in FY2021 that saw its revenue rise 16.9% year on year to S$1.23 billion.
Net property income climbed 18.6% year on year to S$920.8 million and distribution per unit (DPU) inched up 3.9% year on year to S$0.15258.
At a unit price of S$2.72, A-REIT’s trailing distribution yield stands at 5.6%.
The industrial REIT’s credit metrics are healthy with aggregate leverage of 36.8% as of 31 March 2022.
Its cost of debt remained low at 2.1% and its interest coverage ratio stood high at 5.7 times.
Portfolio occupancy also remained healthy at 92.6% while portfolio rental reversion was 4.6% for the latest quarter, up from 2.9% in the previous quarter.
A-REIT had just announced the acquisition of seven logistics properties in the US for S$133.2 million.
This acquisition is yield-accretive and is expected to further diversify the REIT’s logistics exposure.
Get Smart: A great mix of growth and dividends
These three blue-chip companies should provide a great mix of growth and dividends.
They also provide exposure to a variety of industries, allowing for the diversification of your investment portfolio.
These are names you can add to your investment watchlist that are not as volatile or unpredictable as cryptocurrencies.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.
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