A high dividend yield alone is not a good enough reason to jump in and scoop up shares of a company.
What’s more important is whether the dividend can be sustained moving forward.
After all, if you’re a dividend-focused investor, what you seek is the consistency of passive income that will be paid to you year after year.
A business that has a history of churning out a steady stream of dividends over the years will be perceived as being more reliable and dependable.
These include blue-chip companies with resilient business models that have held steady during this pandemic, as well as smaller businesses that have consistently generated healthy free cash flows.
Here are five dividend-paying stocks that can help you to steadily grow your wealth.
Haw Par Corporation Ltd (SGX: H02)
Haw Par is a conglomerate with four distinct divisions — healthcare, leisure, property, and investments.
Its healthcare division owns the iconic Tiger Balm brand, one of the world’s leading topical analgesic brands, with a portfolio of products ranging from ointments to mosquito patches.
The group recently reported its fiscal 2021 first-half (1H2021) earnings.
Revenue fell by 18.6% year on year to S$65.8 million as the pandemic’s movement restrictions led to a lower number of sporting events being held, thereby impacting the healthcare division’s revenue.
Net profit after tax plunged by 41.8% year on year to S$53 million.
However, Haw Par kept its interim dividend constant at S$0.15 per share.
The group has maintained its dividend payment throughout the pandemic, an admirable quality considering the tough challenges the business is facing.
Haw Par continues to receive dividends of S$40 million in 1H2021 from its investments in United Overseas Bank Ltd (SGX: U11) and UOL Group Limited (SGX: U14), which helps to buffer the drop in its operating cash flow.
Singapore Technologies Engineering (SGX: S63)
Singapore Technologies Engineering, or STE, is a global technology, defence and engineering group serving customers in more than 100 countries.
The group serves a diverse portfolio of customers in the aerospace, smart city and public security sectors.
For 1H2021, revenue inched up 2% year on year to S$3.65 billion.
Operating profit rose 10% year on year to S$332.2 million while net profit climbed by 15% year on year to S$296.1 million.
STE declared an interim dividend of S$0.05, unchanged from a year ago.
The group has kept its annual dividend constant at S$0.15 over the last five financial years.
STE’s order book has been steadily climbing since the end of 2019, from S$15.3 billion back then to S$16.8 billion as of 30 June 2021.
PropNex Ltd (SGX: OYY)
PropNex is a real estate brokerage firm with over 9,540 salespeople as of 1 August 2021.
The group has an integrated real estate services model that offers real estate brokerage, training, property management, and real estate consultancy.
Revenue for 1H2021 doubled year on year to S$481 million, driven by a higher number of property transactions as the economy recovered.
Net profit soared by 115% year on year to S$34.4 million.
The group declared an interim dividend of S$0.055, more than triple the S$0.015 declared in the prior year.
PropNex recently announced a collaboration with Tiger Brokers and SingCapital to provide a one-stop trading platform to enhance the competency of its salesforce.
CSE Global Ltd (SGX: 544)
CSE Global is an engineering group that designs and builds customised, integrated systems for its clients to solve problems.
The group has 42 offices across 16 countries and employs around 1,400 employees globally.
Its 1H2021 revenue saw an 8.3% year on year dip to S$234.5 million, principally due to project delays in the Americas region impacted by the pandemic.
Net profit fell by a third to S$10.1 million.
Despite the weaker results, the group declared an unchanged interim dividend of S$0.0125.
CSE Global is confident of achieving a profitable performance for 2021 as it sees a steady pipeline of projects coming from its infrastructure and mining customers.
Venture Corporation Limited (SGX: V03)
Venture is a global provider of technology solutions, products and services.
The group employs more than 12,000 people worldwide and serves customers in multiple technology domains such as life sciences, genomics, medical devices and financial technology.
Venture saw its revenue rising by 4.9% year on year to S$1.4 billion for 1H2021.
Net profit rose by 7.5% year on year to S$140.4 million.
Revenue grew as a result of steady growth in customers’ orders, showcasing the group’s resilience amid the pandemic.
Venture declared an interim dividend of S$0.25, unchanged from a year ago.
Sectors such as liquid chromatography and mass spectrometry represent future areas of growth for the technology business.
Accelerate your retirement plans with these 5 SGX stocks. Their dividends are climbing, and are well-positioned to weather through storms in the future. We think at least one of them deserves a spot in your portfolio. To find out their names, grab a copy of your FREE special report:“Dividend Stocks That Can Pay You For Life” today. Click here to download now.
Disclaimer: Royston Yang does not own shares in any of the companies mentioned.