It’s not unusual for investors to emulate the investment habits of a famous investor.
Warren Buffett is probably one of the most influential and the Oracle of Omaha, as he is known, is famous for his steady, conservative investment style.
Buffett is well-known for his love of companies with strong competitive moats that can take them safely through good times and bad.
The veteran investor is also famous for his love of dividends as many stocks within his portfolio, such as Coca-Cola (NYSE: KO) and Procter & Gamble (NYSE: PG), churn out steady, consistent dividends.
If Buffett were to invest in Singapore’s stock market, he should also look out for similar characteristics.
Here are five Singapore stocks that he will probably feel comfortable investing in.
VICOM Ltd (SGX: WJP)
VICOM is a leading provider of test and inspection services for vehicles and in fields such as mechanical, biochemical, and civil engineering.
The group has a 73% market share in the vehicle inspection market, giving it a sturdy competitive moat in this sector.
VICOM also reported an encouraging set of financials for 2022.
Revenue rose 7.3% year on year to S$108.3 million while net profit inched up 5.7% year on year to S$26.2 million.
The inspection specialist also reported healthy free cash flow generation for both 2021 and 2022.
A total dividend of S$0.0664 was declared for 2022, lower than the S$0.0828 paid out last year, as last year’s payout included a special dividend of S$0.02.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator and enjoys a natural monopoly.
The group has also been a consistent payer of dividends, doling out a payout without fail since fiscal 2001 (FY2001).
The bourse operator reported a commendable set of earnings for its fiscal 2023’s first half (1H FY2023).
Revenue was up 10% year on year to S$571 million.
Net profit jumped 30% year on year to S$285 million, but after adjusting for one-offs, was up 7% year on year to S$237 million.
A total of S$0.16 in dividends was paid out for 1H FY2023, bringing SGX’s trailing 12-month dividend to S$0.32 per share.
Delfi Ltd (SGX: P34)
Delfi manufactures and sells branded consumer products such as confectionaries and chocolates.
The group has an established portfolio of well-known brands such as SilverQueen and Ceres and distributes its products in countries such as Indonesia, Malaysia, and the Philippines.
Delfi posted a strong set of earnings for 2022 with revenue climbing 19.2% year on year to US$483 million.
Net profit jumped nearly 50% year on year to US$43.9 million.
A total dividend of US$0.043 was paid out in 2022, representing a nearly 52% year on year increase.
Delfi will carry on investing in building and growing its brands and introduce products in the healthy snacking category to target younger consumers.
Singapore Technologies Engineering (SGX: S63)
Singapore Technologies Engineering, or STE, is an engineering and technology conglomerate with businesses in the aerospace, smart city, and defence segments.
The blue-chip engineering group has a strong track record of garnering orders and bulking up its order book.
In 2022 alone, STE snagged a total of S$13.1 billion in new contracts, bringing its order book as of 31 December 2022 to S$23 billion.
The group’s revenue also jumped by 17.4% year on year to hit S$9 billion for 2022, in line with its increased order book.
Net profit excluding one-off items, government support and acquisition-related expenses surged 39% year on year to S$549 million.
STE paid out a quarterly dividend of S$0.04, bringing its 2022 dividend to S$0.16 in total.
United Overseas Bank Ltd (SGX: U11)
United Overseas Bank, or UOB, is Singapore’s third-largest bank by market capitalisation.
The bank provides a comprehensive range of banking services to individuals and corporations.
UOB reported a sparkling set of earnings for 2022 with net profit touching a new record of S$4.6 billion.
The lender also paid out a total dividend of S$1.35 for 2022, higher than the S$1.30 it paid out before the pandemic broke out.
There are solid catalysts that should enable UOB to continue this track record.
With interest rates poised to remain high, the bank should see its net interest margin slowly head up, thereby benefitting its net interest income.
UOB also acquired Citigroup’s (NYSE: C) consumer banking division in four countries back in January last year.
Completion was announced for two of these countries, Malaysia and Thailand, back in November 2022, and these two regions should contribute positively to the bank for this year.
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Disclosure: Royston Yang owns shares of VICOM and Singapore Exchange Limited.
