When we invest in the stock market, we typically want to grow our wealth. This comes in two main ways – either in long-term price appreciation or receiving a dividend payout.
According to SGX, analysts are recommending that investors include high-yielding and defensive stocks, on the back of increasing geopolitical uncertainty and slowing global growth. To find these companies, we can look at the FTSE ST Small Cap Index, which has a combined market capitalisation of $37 billion, and comprise 49 constituents, out of which 20 are REITs.
The dividends these companies pay us can be used to provide added financial muscle in subsequent investments we make, give us the freedom of going on a holiday or making a luxury purchase for “free”, or even allow us to use for our living expenses if we retire.
In this week’s edition of 4 Stocks This Week, we look at the 4 small cap non-REIT companies with the best dividend yields in Singapore.
UMS Holdings (SGX: 558)
UMS is a precision engineering group which specializes in front-end semiconductor components and perform complex electromechanical assembly and final testing services. Its customers are mainly from the semiconductor, electronic, machine tools, aerospace and oil & gas industries.
At a market capitalisation of $333 million, UMS is currently paying a dividend yield of 7.4%. Its share price is currently trading at $0.63, which is 10.5% higher than its share price of $0.57 at the start of the year.
Valuetronics Holdings (SGX: BN2)
Headquartered in Hong Kong, Valuetronics is an integrated electronics manufacturing services provider, focusing on the design and development of products. Its customers are mainly global companies in consumer electronics as well as industrial and commercial electronics products.
Valuetronics has a market cap of close to $268 million, and pays out a dividend yield of 7.1%. Currently trading at a share price of $0.63, Valuetronics year-to-date return is -1.9%. This is on the back of a 4% dip in its share price from the start of the year, at $0.66.
QAF Ltd (SGX: Q01)
QAF has been listed on the SGX since 1967. Its main business activities include the manufacture of bread, bakery and confectionary products; operations of supermarkets; cold storage warehousing; trading and distribution in food, beverage, food-related ingredients and commodities; production, processing and marketing of pork and feedmill production; and investment holding.
With a market capitalisation of $434 million, QAF currently has a 12-month distribution yield of 6.8%. In the year-to-date, QAF has delivered a total return of 33.8%. This is on the back of a strong performance in its share price, which is trading at $0.745, a 28% increase since the start of the year.
Duty Free International (SGX: 5S0)
Duty Free International is the largest duty-free retailing group in Malaysia, with presence at 40 leading entry and exit points in Peninsular Malaysia, including airports, seaports, downtown, border towns and popular tourist destinations.
With a market capitalisation of $179 million, Duty Free International currently has a dividend yield of 6.7%. However, its total return in the year-to-date stands at -20.2%. This is on the back of weakness in its share price, currently trading at $0.155, a 21% dip from the start of the year.
Can Your Investments Survive 2021 And Beyond?
While most of us have survived the year, how has your portfolio fared? The financial markets took us and our emotions on a wild roller coaster ride in 2020, leading to some poor decisions like panic selling or missing out on opportunities as fear and uncertainty held them back.
As we step into 2021 amidst a “New Normal”, join the FSM’s flagship event – “What and Where to Invest” held virtually from 9 to 26 January 2021. Be equipped with the right knowledge and skills that will help you invest globally and profitably.
Prepare yourself for the investing years ahead and register now for “What and Where to Invest” virtual conference!
4 Stocks This Week is not a recommendation from us to buy or sell any of these stocks. For investors who are keen to find out more, you should continue researching about them before making your investment decisions.