Top 8 Blue Chip Stocks to Invest in Singapore 2018
Blue chip stocks are public listed companies that have a substantial market cap and over twenty years of operating history. Such companies have proven their long term sustainability and profitability. These companies are deemed strong on the bases of their business fundamentals, dividend yields and the capacity to endure during a financial turmoil. There is no dearth of blue chip stocks on the Singapore Stock Exchange but not all would be desirably rewarding through 2018 or in the near future. There are eight blue chip stocks that are expected to fare well through the year. Anyone interested in blue chip stocks or looking at expanding their investment portfolio should consider these eight companies.
The banking sector is expected to fare well throughout the year. It has already recorded significant growth, especially following the slowdown and subsequent stagnancy in the first half of the decade. The two promising blue chip stocks in this sector right now are DBS and Bank and OCBC Bank. Local banking stocks would be subjected to steady appreciation as the banks generate more net income on the basis of higher interest and there is an upswing in revenue generation through fees charged for various wealth management services. Local banking stocks are held at a price to book ratio of 1:4, which is lower than the 1:6 price to book ratio of regional banks. As the local banks steady their sailing, the potential dividend yields make them a worthwhile consideration.
DBS has a lean cost to income ratio, their interest margins are estimated to be substantial and it would also benefit from increasing interest rates as well as the stabilization of oil and gas sector. The interest margins have risen by seven basis points already and the growth is pegged at a minimum of 7%. Special dividends were announced eventual dividend rates were increased. DBS Bank shares have a yearly dividend yield of 3.21%.
OCBC has been aggressive with its acquisition plans and is expanding its wealth management operations. OCBC has acquired the private wealth management division of National Australia Bank. Rate of net interest income increased 14%, leading to a 19% net growth in profit. Dividends were reviewed and increased owing to surplus capital and better financial performance. OCBC will continue to grow through 2018 and presently has a dividend yield of 2.82%.
The property sector has undergone some degree of resurgence. Prices of private homes have increased by 1.7% since its lows in 2017. The three property sector stocks you should consider are CapitaLand, City Development Limited and UOL Group Limited. Many investors stayed away from the property sector for the last three years owing to stagnation. CapitaLand is presently poised to generate a dividend yield of 3.38%. City Development Limited has 0.63% dividend yield and UOL Group Limited is pegged at 1.81%.
The consumer sector is on an upswing. The three blue chip stocks in this sector worth considering are Genting Singapore, SATS and Venture Corporation. The three are pegged with dividend yields of 2.33%, 3.26% and 2.00% respectively. The consumer sector is being buoyed by a thriving tourism sector, friendly budget and revival of consumer sentiment that is further influencing spending habits.
About the Author
Morris Edwards is a content writer at CompanyRegistrationinSingapore.com.sg, he writes different topics like Wealth investments paying off for Singapores big three banks, 62% of Singaporean Firms Plan to Increase Global Investments and all topics related to Doing Business in Singapore. If you want to learn more about Singapore Company Setup , visit our website.
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