As the end of 2022 approaches, many of you may be looking forward to receiving your annual wage supplement (AWS) or a good bonus.
This additional cash could be spent on a great holiday now that borders have reopened.
But you can also consider parking some of it in solid, dividend-paying stocks to help bolster your retirement funds.
With a possible recession looming, it’s good to seek shelter in dividend-paying stocks that offer you a reliable stream of passive income.
Remember that you should only allocate money into the stock market that you will not need for the next three to five years.
Always keep a cash stash of at least six to 12 months’ worth of expenses as an emergency fund in case of tough times.
Here are five stocks I will consider buying if I had S$30,000 to spare.
Sheng Siong Group Ltd (SGX: OV8)
Sheng Siong is one of the largest supermarket chains in Singapore with 66 outlets across the island.
The group offers more than 1,500 products across its 23 house brands.
The retailer has turned in a resilient performance for the first nine months of 2022 (9M2022).
Revenue dipped just 1.9% year on year to S$1 billion while net profit stayed flat at S$100 million.
An improvement in Sheng Siong’s gross margin from 28.5% to 29.4% in 9M2022 helped the group to mitigate some of the weaknesses in its revenue.
With the ramp-up in the supply of HDB flats, Sheng Siong hopes to continue growing its store network in 2023.
The retailer paid out a trailing 12-month dividend of S$0.0625, giving its shares a trailing dividend yield of 3.8%.
The Hour Glass (SGX: AGS)
The Hour Glass, or THG, is a luxury watch retailer with a network of 50 boutiques across the Asia-Pacific region.
The group sells famous Swiss watch brands such as Rolex, Patek Philippe, Cartier, and Omega.
THG reported a healthy set of financials for its fiscal 2023’s first half (1H2022), with total revenue rising 18% year on year to S$562.7 million.
Net profit jumped 35% year on year to S$84.6 million.
An interim dividend of S$0.02 was paid out, bringing the luxury retailer’s trailing 12-month dividend to S$0.08.
At S$2.07, THG’s shares offer a trailing dividend yield of 3.9%.
Delfi Limited (SGX: P34)
Delfi manufactures and sells a portfolio of chocolate confectionary brands in 17 countries including Singapore, Indonesia, Malaysia, Hong Kong, and Thailand.
The food and beverage manufacturer reported a healthy set of financial numbers for its recent business update.
For 9M2022, revenue increased 20.4% year on year to US$358.3 million.
The group had US$80.3 million of cash as of 30 September 2022 along with US$13 million in debt.
Delfi paid out an interim dividend of S$0.0218 for 2022, higher than its S$0.0171 paid out last year.
Coupled with the final and special dividends of S$0.0144 and S$0.0064, the total 12-month trailing dividend was S$0.0426, giving Delfi’s shares a trailing dividend yield of 5.5%.
PropNex Limited (SGX: OYY)
PropNex is an integrated real estate services group with 12,065 sales professionals as of 2 November 2022.
The group has a strong presence in Singapore’s property market and also has a presence in Cambodia, Indonesia, Malaysia, Vietnam, and Australia.
For 9M2022, the real estate group reported a slight 2.1% year on year increase in revenue to S$730.8 million.
Net profit dipped by 6.7% year on year to S$46.5 million.
The Singapore government recently introduced yet another round of property cooling measures in September 2022 to moderate demand.
Despite this move, PropNex should still do well with its established position in the real estate market.
The group paid out a final dividend in FY2021 of S$0.07 and an interim dividend this year of S$0.055, bringing its trailing 12-month dividend to S$0.125.
At S$1.53, its shares offer a trailing 12-month dividend yield of 8.2%.
AEM Holdings Limited (SGX: AWX)
AEM provides semiconductor and electronic test solutions and has manufacturing plants in Singapore, Malaysia, Indonesia, Vietnam, China, Finland, South Korea, and the US.
For 9M2022, the group reported its highest revenue in history, leaping by 120.6% year on year to S$746.5 million.
Its net profit surged by 117.6% year on year to S$115.3 million.
AEM maintained its revenue guidance of S$820 million to S$850 million for FY2022 due to strong demand from new and existing clients.
The test solutions company paid out an interim dividend of S$0.067.
Together with last year’s final dividend of S$0.05, the trailing 12-month dividend came up to S$0.117.
AEM’s shares now offer a trailing 12-month dividend yield of 3.2%.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.
