Investing in stocks involves risk taking, but investors who pick companies with strong fundamentals and have a long horizon, invariably succeed.

Investing in high dividend yielding stocks is considered a safe bet by many analysts. That’s because only those companies that are confident about future earnings and have strong cash flow tend to distribute dividends

There is a common misconception that capital appreciation from high dividend stocks are lesser compensating via dividends

Dividends provide assurance to investors with a steady flow of income. Such stocks are as asset in one’s portfolio when markets turn bearish.

As reqard to the high dividend yield stocks, I have vested in Second Chance, Chip Eng Seng, Cordlife, Metro, Stamdford Land, First Reit & Cambridge Reit which gave me passive income.

For the Reit, I have not only received high dividend but also capital gain. My reason for these 2 Reit are:

First Reit

Trading at $1.10 dividend yield is still about 6.5%. It's in health-care business which is resilence. Leverage is the lowest but have seen been increase from 16% to 31% which is still lower than most Reit. First Reit have good management in sponsor parent Lippo Group. At the point when I vested, dividend yield is about 18%. Just recently I have sold down by half my holding.

Cambridge Reit

Trading at 75 cents dividend yield is still about 7%. I had vested in this stocks because of the Lam Soon Industrial Building.

Cambridge Reit has 97 units freehold strata in Lam Soon Industrial Building represent 69.44% of the building total share value.

The 230.915 square foot freehold site, with a gross plot ratio of 1.92, had an indicative price of $330 million. Inclusive of development charge of $80 million, indicative price worked out to about $925 per ft per plot ratio. CIT purchased the 97 units in 2006 for $72.2 million. So there is a good opportunity for it's to unlock value. On top of that at the point when I vested, dividend yield is about 10%.

As for the other Reit which have good management such as Capital Mall, Ascendasreit & Mapletree the dividend yield is about 5% which is not so attractive. At 5% I believe the downside is more than the upside.

Relaxing, whether those guys are contra or long term investors, they need to  get their heads examined! Buying at ++100%  is crazy just on news of Sam Goi buying a stake. 

FYI Phillip Capital research has an unrated report on ChipEngSeng today, valuing its RNAV at $1.49, which is quite close to sumer's estimates of $1.60.

I am not sure how to attach the report, but here is a short write up of it on a blog:

http://alanu6.blogspot.sg/2013/02/chip-eng-seng.html

The main difference I believe might be due to Phillip's report valuing the 4 star Alexandra hotel much more conservatively at $500k per key instead of sumer's $650k.

Park Regis a 4 star hotel at Merchant Road has been put up for sale again and is estimated to be able to fetch $220-230m. CDL HTrust are among the interested parties and there is talk that it will be going for $250m. The hotel has 203 rooms with a 7 storey office tower of 41,452sqf of NLA, and I think that could work out to be about $1m per key, though its located more centrally.

http://www.propertyguru.com.sg/property-management-news/2012/12/34856/park-regis-singapore-back-on-the-market

4Q result likely good and after announcement, will it announce a smal share placement for price to be pushed up like other s-chips?

Someone should introduce Food Empire to Sam Goi. Food Empire is in the same industry as Super Group, of which Sam Goi is a very large shareholder. Super is trading at super valuations while Food Empire is at more modest valuation. 

Watching with great interest. Hope those who bought at 35 cts when market opened this morning are not day contra players? Not vested.

Moving up slowly like snail LOL

Sam Goi has just enter a subscription agreement with Yamada Green Resources. Looking at the price trend of etika and JB Foods, better to take up positions quick.

nice close at 10.3 cts.

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Effective date of the Transfer is 21 February 2013. Trading of the Company’s shares on the Main Board of the SGX-ST will commence at 9.00 a.m. on 21February 2013. Oxley is up 0.5 c, now at 35 c. Whoopeee!

Result for the last 2 quarters ie july to sept 2012 and oct to dec 2012 have been very encouraging with profit of S$1.9 n S$2.1 mil respectively. This work out to be S$4.0 mil.

If the profit trend persist, we will be able to see a set of very good result this current financial year 2013 on top of the attractive dividend yield.

On current price of 9.5 cts and dividend of 0.8 cts, the yield is around 8.4%.

I believe Health-care business are resilence in nature. Below listed Health-care stocks for a general comparison:

Cordlife - 68 cents

PE around 15

PB about 2

Revenue growth about 20%. Profit about 50%

Net profit margin = 34%

IHH - $1.335

PE about 70

PB 0.6

Revenue growth - not consistence

Net profit margin = 11%

Pacific Healthcare - 7.5 cents

PE - making lost

PB about 3.5

Growth - Negative

Q & M 32.5 cents

PE more than 30

PB more than 6

Revenue growth about 20%. Profit about 10%

Net profit margin about 10%

Raffles Mediccal $3.15

PE more than 30

PB more than 4

Revenue growth about 10%. Profit about 10%.

Net profit margin less than 20%

CORDLIFE clearly top the lists in term of growth, profit margin & best of all yield. Useing PE as a comparison it's the cheapest.

Oops, didn't realise there were questions asked.

Orchid: yes, future net profits are worked into RNAV, and discounted by a rate one deems suitable. So, profits have an impact.

RNAV should not be the sole reason to buy a stock. Personally, I like to look for catalysts, in addition to using RNAV as an added incentive and cushion should the catalysts not surface. Pure earnings stocks without RNAV to back up can plunge on earnings disappointment or loss of old business, for eg.

As an example, when I looked at CES when it was below 50ct, it was not RNAV per se that made me invest in it, but the string of catalysts listed in my earlier posts (launch of Alexandra shops, PS100, Tower Melbourne). Then, as I add in the future profit stream (lots of its props were already pre-sold), I discovered that its RNAV could surge substantially.

So, if catalysts are lacking, and a co is losing money, again you have to see if it's a one-off loss, or recurrent, etc. And if there are many positive catalysts apart from that lack of earnings, you then have to consider which side the final judgment tilts towards.

Boh Tea: RNAV is about assumptions and estimates, and hence, my estimates were based on certain assumptions, naturally. I think my estimate for HH floats between the co keeping ZP for recurrent income (which would have a low value) and finally selling it off after 2 years (which would give a high value; note I think the 2 year thing is to avoid tax). I then decided on an "in between" kind of figure.

I understand the co is taking up 1 or 2 floors of the office space, but this is insignificant compared to the total GFA of the 2 hotels, retail and office spaces.

COSTs: Sorry, I don't quite understand the part where you talk about cost. RNAV is based on estimates and assumptions, which are necessary for you to arrive at any figure. You have to "stop" somewhere between the most optimistic and most pessimistic scenarios, otherwise you can never arrive at any RNAV. That's why10 other people doing a calculation on RNAV will arrive at 10 different figures, depending on where they "stop" in that scale of scenarios.

For eg, in the case of Heeton, taking The Lumos alone, my estimate is based on a final selling price of $2,000 psf for its remainder units. This is $500 psf lower than the current price the co is trying to sell at, and $1,000 psf below the prices of the units they had already sold. I could "stop" at $2,500 psf, or $1,500 psf, but I chose $2,000 psf, which to me, at this moment, is reasonably "doable", taking into account they did not sell any unit at their current asking price of $2,500-2,700 psf, and also that a stock clearance sale of $1,500 psf would be unnecessarily pessimistic.

erelation: Yes, Heeton is not able to sell any unit at iLiv and the remainder units at Lumos, and that's a negative. I also dislike the fact that they have not monetized Sun Plaza, and has changed plans for El Centro (being rented out again instead of being redeveloped as expected earlier). However, it is exposed like KSH to several projects with retail shops, and these will likely be sold at good margins.

Heeton has also presold a good number of units at The Boutiq, Sky Green and Palacio, allowing some steady stream of profit. At the same time, because there are so few issued shares, the effects of profits and asset value on a per share basis are quite substantial. Also, it turns out that holding Sun Plaza had not been too bad a move considering that retail space prices have gone up a lot.

RNAV calculation is an art and not a science. So there will always be questions on why this assumption is taken or why another estimate is not chosen. I can only say that the figures given in my table earlier are only "my" estimates of the RNAVs - one of perhaps 100 estimates that can be arrived at by 100 different people. I don't think my estimate is "right" but just "one of many possible estimates".

Finally, do use RNAV in conjunction (perhaps as a support) with your takes on catalysts, theme plays, market timing, new flows, management's trustworthiness and agility, etc. Ultimately, it is demand and supply for a share that affects the share price, not RNAV per se.

Btw, I am currently busy with some personal business, so I may not be able to contribute for the time being.

Broker said Roxy-Pacific results expected tomorrow or Wednesday. The stock today +1.5 cents and reached a record high of 63 cents. Solid growth in recent 2 years. But how to continue at this pace?

In the ordinary course of events, an analyst only initiates coverage of a stock after at least 1 meeting with the CEO.  I presume this is the case for King Wan Corp's initiation by OSK-DMG. I further can be reasonably confident that he received guidance regarding the plan for a special dividend for the next 10  years. The circumstances may be conducive for the special dividend or the may not, but heck for now the prospects look attractive. 

The OSK report is accessible at: 

http://mail.dmg.com.sg/dmgnew/dmgrshnew.nsf/9eab09ed7daefad24825725e00186049/6252070fe3209a9648257b0800380996?OpenDocument

I am still hunting for the SIAS one which came out just today. Anyone has it?