In recent times, the Singapore market has shown a steady, flat performance both over the past week and year, with expectations of earnings growth at an annual rate of 9.2% in the coming years. In such a stable market environment, dividend stocks like Singapore Airlines offer potential for consistent returns, making them an attractive option for investors seeking regular income streams.
Overview: Singapore Airlines Limited operates passenger and cargo air transportation services globally under the Singapore Airlines and Scoot brands, with a market cap of approximately SGD 24.95 billion.
Operations: Singapore Airlines Limited generates revenue primarily through its Full Service Carrier segment at SGD 16.18 billion, followed by its Low-Cost Carrier operations at SGD 2.45 billion, and Engineering Services contributing SGD 1.09 billion.
Dividend Yield: 6.9%
Singapore Airlines has proposed a final dividend of S$0.38 per share, signaling a positive gesture to shareholders despite its history of volatile dividends. Recent operational expansions and the establishment of Singapore Airlines Foundation suggest strategic growth, although earnings are expected to decline by an average of 20.2% annually over the next three years. Trading at a P/E ratio below market average and with dividends covered by both earnings and cash flows, the stock offers mixed prospects for dividend investors seeking stability and growth.
Overview: Delfi Limited is an investment holding company specializing in the manufacturing, marketing, distribution, and sale of chocolate and chocolate confectionery products across Indonesia, Philippines, Malaysia, Singapore, and internationally, with a market capitalization of approximately SGD 0.50 billion.
Operations: Delfi Limited generates revenue primarily through its operations in Indonesia, which brought in SGD 370.41 million, and its regional markets, contributing SGD 185.07 million.
Dividend Yield: 7.1%
Delfi Limited's dividend yield of 7.13% ranks well above the Singapore market average, yet its sustainability is questionable with a cash payout ratio of 1776.7%, indicating dividends are not adequately covered by cash flows. Despite trading at 44.4% below estimated fair value and potential price growth forecasted at 36.5%, both earnings and dividends face coverage issues, as evidenced by a high non-cash earnings level and unstable dividend history over the past decade.
Overview: Civmec Limited, an investment holding company based in Australia, offers construction and engineering services across various sectors including energy, resources, infrastructure, and marine and defense, with a market capitalization of SGD 482.21 million.
Operations: Civmec Limited generates revenue from three primary segments: Energy (A$46.02 million), Resources (A$752.82 million), and Infrastructure, Marine & Defence (A$105.52 million).
Dividend Yield: 5.1%
Civmec Limited, while trading at 36.9% below its estimated fair value, shows a moderate dividend yield of 5.12%, lower than the top quartile of Singapore dividend stocks at 6.27%. Dividends are well-supported with a payout ratio of 45.4% and an even more conservative cash payout ratio of 27%, ensuring sustainability from both earnings and cash flow perspectives. Recent contracts worth A$174 million boost its business stability, though its dividend growth is modest compared to peers with higher yields and faster growth rates in dividends over the past decade.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include SGX:C6L SGX:P34 and SGX:P9D.
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