As an investor, you should constantly be on the lookout for great investment ideas.
By surveying the landscape for potential investments, you can sharpen your mind and also identify attractive opportunities to park some money.
It’s an interesting thought exercise that should gel with your personal investment goals.
For myself, I always imagine how I would deploy a tidy sum of S$20,000 if I had this spare cash.
I’d usually gun for a mix of growth and dividend yield, so my investment radar will be searching for stocks that can provide this juicy combination.
Here are three dividend-paying stocks that I believe can give me the bang for my buck.
AEM Holdings Ltd (SGX: AWX)
AEM provides comprehensive test solutions for the semiconductor and electronics sector and has manufacturing plants in countries such as Singapore, Malaysia, Indonesia, and the US.
The group recently reported its fiscal 2022’s first half (1H2022) earnings that saw its highest revenue and profit before tax in the group’s history.
Revenue jumped more than two-fold from S$192.2 million to S$540.5 million in 1H2022.
Net profit surged from S$29.7 million to S$83.1 million.
AEM’s interim dividend has also more than doubled year on year from S$0.026 to S$0.067, with the group retaining three-quarters of its net profit for reinvestment in the business.
Together with last year’s final dividend of S$0.05, the test solutions specialist’s trailing 12-month dividend stands at S$0.117.
Its shares now offer a trailing dividend yield of 2.6%.
While this may not seem high, remember that AEM expects more growth that could translate to higher profits and, by extension, higher levels of dividends.
It announced two new customer wins in the high-performance computing, artificial intelligence and mobility processors space.
In addition, the group also revised its revenue guidance for FY2022 to be in the range of S$750 million to S$800 million, up from its previous range of S$700 million to S$750 million.
PropNex Limited (SGX: OYY)
PropNex is an integrated real estate services group with over 11,744 sales professionals as of 1 August.
The group provides a range of services such as real estate brokerage, training, property management, and real estate consultancy.
The property brokerage firm reported a downbeat set of earnings for 1H2022 as transaction volumes moderated following the introduction of fresh property cooling measures in December last year.
Revenue dipped by 1.8% year on year to S$472.3 million while net profit fell 17.7% year on year to S$28.3 million.
Despite the weaker results, PropNex declared an interim dividend of S$0.055, unchanged from a year ago.
Coupled with the final dividend of S$0.07 from last year, PropNex’s trailing 12-month dividend stands at S$0.125, giving its shares a trailing dividend yield of 7.6%.
The outlook is bright for the property market as prices for resale condominiums crept up for the 24th consecutive month even as interest rates head up.
Analysts are also confident that current mortgage rates are still manageable and do not expect home buyers to feel the pinch.
In the longer term, the relocation of Paya Lebar Air Base will allow for the redevelopment of Hougang, Punggol and Marine Parade, freeing up land for 150,000 new homes.
These trends bode well for PropNex even as it extends its footprint into Australia, its sixth market in the Asia-Pacific region.
Sheng Siong Group Ltd (SGX: OV8)
Sheng Siong is one of the largest supermarket chains in Singapore with a network of 66 outlets across the island.
The group offers more than 1,500 products under its 23 house brands and sells a wide variety of household products, food and other necessities.
The retailer has remained resilient despite a drop off in sales from the pandemic boost last year.
Revenue dipped just 0.7% year on year to S$676.8 million for 1H2022 but net profit inched up 2.1% year on year to S$67.5 million because of better profit margins.
An interim dividend of S$0.0315 was declared, slightly higher than the S$0.031 paid out in 1H2021.
Together with last year’s final dividend of S$0.031, the trailing 12-month dividend came up to S$0.0625, giving Sheng Siong’s shares a trailing dividend yield of 3.9%.
The group will continue to look for potential space in new HDB estates to establish new stores.
Construction of HDB is now back on track with the lifting of restrictions and will enable Sheng Siong to tap on opportunities to open more stores.
At the same time, the retailer will continue to improve its gross margin and find ways to counteract rising costs from inflation.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.