Several blue-chip stocks in Singapore have seen robust rallies recently, lifting share prices to their highest points not seen in years.
As valuations rise, investors are wondering if there is still room for upside, or whether much of the good news has already been priced in.
A look at the fundamentals helps to place things in context.
We look into three well-known names – Singapore Airlines Ltd (SGX: C6L), Keppel Ltd (SGX: BN4), and Singapore Technologies Engineering Ltd (SGX: S63) – to evaluate which of them can continue to benefit long-term investors even after the recent rally.
Why Rising Prices Alone are not a Reason to Sell or Buy
A rising share price does not always mean a stock is expensive or attractive.
What matters more is whether earnings are sustainable beyond the current cycle and supported by a balance sheet strong enough to weather economic headwinds.
Investors must distinguish between cyclical gains and structural growth, ensuring valuation is assessed against long-term earning power rather than peak profits.
Ultimately, overpaying for even a high-quality business can limit future returns.
Singapore Airlines: Recovery Is Real but Cyclicality Remains
Singapore Airlines (SIA) has seen appreciation of its share price as the global travel market rebounds, currently trading near its 52-week high of S$7.63.
The airline has a market capitalisation of around S$21 billion.
Net profit for FY2024/2025 ended 31 March 2025 was S$2.78 billion, boosted by a one-off gain arising from the Air India-Vistara transaction.
Half-year FY2025/2026 (1HFY2025/2026) results show net profits normalising to S$239 million.
SIA’s operating margin has normalised to around 8.3% as the industry-wide capacity boom cools.
While trailing net margins were historically higher due to one-off merger gains, the core business continues to support a healthy trailing dividend yield of 5.4%.
The national carrier of Singapore maintains a resilient balance sheet, holding around S$6.5 billion in cash against S$10.9 billion in total debt, resulting in a manageable net leverage position.
While the stock offers continued exposure to the global travel recovery, the current upside appears to be cyclical rather than structural.
Investors should note that SIA possesses significant potential linked to recovery, but high volatility and normalising passenger yields remain inherent risks to the business model.
Keppel: Structural Growth with Execution Risk
Keppel has expanded its activities from offshore and marine to include infrastructure, energy transition, data centres, as well as asset management.
Its share price reached an all-time high of S$12.69 on 13 February 2026.
Full year 2025 (FY2025) net profit surged 39% year on year (YoY) to S$1.1 billion, with improvements across all business segments and record earnings by the Infrastructure Division.
Group revenue rose 3.4% YoY to almost S$6 billion, while profit attributable to shareholders came in at S$789 million, 16.1% lower compared to a year ago, dragged by a S$222 million accounting loss from the proposed sale of M1’s telco business.
As of 31 December 2025, Keppel improved its net gearing to 0.82x with S$2.3 billion in cash against S$11.3 billion in debt.
The group proposed a 38% YoY increase in total distribution to S$0.47 per share, bolstered by a S$0.13 special dividend in cash and REIT units.
The balance sheet has strengthened post-asset divestments, with manageable gearing and improving cash flow visibility.
Looking ahead, Keppel aims to scale funds under management (FUM) to S$100 billion by end-2026 and S$200 billion by 2030, supported by a deal flow pipeline of about S$33 billion across its three divisions.
In short, Keppel possesses structural growth potential, and execution discipline in large projects is necessary to deliver the upside.
ST Engineering: Defensive Earnings with Steady Growth
Riding a year-long upswing, ST Engineering shares hit a historic peak of S$10.20 last week (10 February 2026), marking a significant milestone for the group’s valuation.
The core competency for the company is its diversified global footprint and a robust, record-high order book.
As of 30 September 2025, the group’s order book reached S$32.6 billion, providing strong revenue visibility.
Nine-month (9M2025) revenue grew 9% YoY to S$9.1 billion, underpinned by strong growth across all segments, particularly in Commercial Aerospace and Defence & Public Security.
ST Engineering has paid consistent dividends, declaring a total ordinary dividend of S$0.18 per share for FY2025.
Additionally, the board has proposed a special dividend of S$0.05 per share following the successful unlocking of S$594 million in cash proceeds from divestments.
ST Engineering offers dependable earnings and attractive shareholder returns through its updated dividend policy, which aims to distribute one-third of incremental net profit growth from FY2026 onwards.
Get Smart: Look Beyond the Rally
When comparing these three blue chips side by side, the distinct profiles of each stock become clear.
Singapore Airlines offers the strongest cyclical earnings potential, though it remains closely tied to industry cycles and volatile fuel prices.
Keppel occupies the middle ground, shifting towards the space of infrastructure and energy transition to capture long-term structural growth through its asset-light model, appealing to those seeking transformational growth.
ST Engineering provides the most stability, offering a premium for its counter-cyclical nature and highly predictable recurring revenues, making it the primary choice for dependable dividends and income security
Ultimately, long-term investors should look beyond immediate price movements to choose the business model that best aligns with their specific portfolio objectives and risk appetite.
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Disclosure: Darien.C does not own shares in any of the companies mentioned.
