My 4 Key Ideas for 2018 and Beyond

These 4 positions is where I put most of my money on for the year 2017, they are my long term bets for 2018 and beyond
I believe that their valuations are still fair for entry despite this bull market

$ThaiBev(Y92.SI)
I believe earnings growth will explode again post thai king mourning.
The biz is very cash generative and the recent acquisitions will further help push earnings growth.
3% dividends + 5-8% long term earnings growth for total 8-11% expected long term returns

$SingTel(Z74.SI)
Solid decade track record of same or higher dividends, I believe I am getting close to 5% yield with long term dividend growth of around 3% for a solid and stable 8% long term total returns
ST is very diversified so I am not too fearful of the 4th telco's entry

$ComfortDelGro(C52.SI)
Even without the taxi biz, I believe their remaining biz will be able to maintain the 10 cent dividends payout for a solid 5% yield. I expect 2017 and 2018 earnings to be down by single digits, followed by growth resuming again in 2019 onward.
I expect a 5% yield and long term 3-5% earnings growth in their public transport segment (bus/train) for long term returns of 8-10%
do note that my valuation model conservatively puts their taxi biz as zero value

$Sheng Siong(OV8.SI)
I believe SS still has room to grow towards 50 stores in singapore, followed by their expansion into china market. I am expecting 4% dividends + 4-8% long term earnings growth for a total expected return of around 8-12%.

So far my strategy has been to look for solid companies with over 5-10 years track record of earnings and dividends. I often set a min return requirement of 8%, so therefore most if not all of my picks I aim for 8-10% returns or higher in the long run.
So far over the last decade plus I have made a XIRR of around 12%, so I intend to continue my current strategy of quality companies for long term ^^

As the market goes higher and in 2018 we are likely to see an even higher index... I probably wouldn't be doing anymore buying next year. I am done shopping and I'll be patiently riding this bull while rebalancng at times into some cash.

Do note that I am vested in all 4 counters and my views are strongly biased, please do your own due diligence before following the same bet.

Cheers

Read more
73 likes 146 comments
MasterLeong

added 10,000 TB today to bring my total position to 60,000
TB is now my top position cheers

Sporeshare

Reply to @RetiredOldMan : I Thnk Long term should see the benefit . Short term high debts , lower profit .

  View More Replies Small loading
MasterLeong

added 10,000 more shares of SS today ^_^
total now 40,000
looking to bring it to 50,000 if it goes even lower

MasterLeong

Reply to @matthewang : so far redmart and amazon these online players only taking 2% of the market share, 98% of groceries still bought physically from shop

  View More Replies Small loading
MasterLeong

SS pulling back a bit, 90 and 92 cents level seems decent for accumulation, i looking to add more ^_^

limraymond

Reply to @RetiredOldMan : I see the bottoming is near but as it is Dec side way movement i always there. Just look out for heavy selling.

MasterLeong

must see if CDG can reach 2.00 and hold above that level, if so would be a healthy sign

if still below 2.00 means traders still uncertain

MasterLeong

CDG up 3-4%, i think the bottom is likely over

MasterLeong

Reply to @seba240698 : if buy not scared
if scared dun buy

  View More Replies Small loading
eugenetavano

Singtel will disappoint!

limchris8

Reply to @eugenetavano : For near term, Singtel is upward trend. Recently, there is a worldwide re-rating of Telcos. That is why there is a spillover to Singtel. Currently it is trading with CD. When the Hill Street Telecom Bldg is finally sold, it should add to Singtel profits. I no longer have Singtel. I am merely talking about facts. No need to reply to me. It is too tedious for me to see too many threads. Cheers!

  View More Replies Small loading
matthewang

Reply to @matthewang : ST Huat ah!!! SH Huat ah!!!! SS not so huat.....

  View More Replies Small loading
limraymond

Reply to @thamwk : Market weak due to banking stock correction and the div in Singtel does provide the reason to be vested, the next resistance will be 3.85.

  View More Replies Small loading
Hachiko

CDG 1.93 now! Insiders sure know something?

tansoonchai

Reply to @Hachiko : Maybe 1.85 tmr , nobody will know..
1.80 is my base line, might grab some in between along the way. Feel no hurry for entry as the trend should be downwards for some period

  View More Replies Small loading
tansoonchai

Can share average price you are vested in?

tansoonchai

Reply to @RetiredOldMan : Haha fully understand your feelings

  View More Replies Small loading
View More Comments (35) Small loading

Revision History


Recommended & Related Posts

MasterLeong started a poll

do you think $ThaiBev(Y92.SI) will eventually break 80 resistance or break 78 support?

Read more

$ThaiBev(Y92.SI) no clear signal
Need to break above 80 cents resistance sharply
Or break below 78 cents support sharply
Meanwhile the bull and bear fights

Read more

$ThaiBev(Y92.SI)

currently holding 100,000 shares
looking to add 50,000 more if it comes to 75 cents level

cheers

Read more

Its time to bet on growth stocks and avoid Reits!

Interest rates are going up, the 10 year US risk free bond now pays 3%
imagine 1-2 years later the same bond pays 5% risk free instead

if you are a new investor looking for income, what's stopping you from putting your 100k into a risk free 5% annual income?
say you are a bit more greedy and you want a higher yield... you may put it into reits... but what kinda returns are you looking for? probably 7-8% yield

yes, as investors demand for higher dividend yields, traditional dividend plays like reits and telcos will have to yield 7-8% and thus their stock prices will be way lower than the current prices you have seen now

thus my divestment of $SingTel(Z74.SI) in recent times at around 3.50 level, I was in for the NLT one time gains.. but the special dividends was too stingy.. still I took the dividends and then headed to the exits

I had held 5 reits $Suntec Reit(T82U.SI) $CapitaCom Trust(C61U.SI) $CapitaMall Trust(C38U.SI) $Mapletree Com Tr(N2IU.SI) $Frasers Cpt Tr(J69U.SI)

and had divested 3 of them while keeping CMT and MCT only, I am keeping a balanced approach with less than 20% of my portfolio exposed to reits... I do not want to be caught in the reits sell down when it happens.

so how should we invest in a rising rate environment?

firstly I think we should prefer net cash companies over highly geared companies
as higher rates will lead to higher interest costs
higher interest costs will lead to lower earnings

some net cash growth companies that I own are
$ComfortDelGro(C52.SI) $Sheng Siong(OV8.SI) $HRnetGroup(CHZ.SI)

their businesses are very cash generative and they do not need to take on debt to grow their business year after year

$ThaiBev(Y92.SI) would be an exception as its gearing is very high at 150%, it has taken up a lot of debt to fund its 4 major acquisitions thus making it very at risk of high rates, however management has been prudent in locking in the rates by issuing bonds at average cost of under 3% at 2/5/10 year maturity.. so basically they have already locked in the current low rates for the years to come.. so I am not that worried

however given that said, do not forget that thaibev is still a higher risk stock while netcash companies like CDG,SS,HRN are safer and less exciting picks.

as rates goes up, reits will have to pay higher cost on their debt... thus DPU may fall and equity rising (rights issue/placement) will get more and more common

I am bearish on reits and would surely prefer net cash companies over highly geared companies

cheers

Read more

Its time to bet on growth stocks and avoid Reits!

Interest rates are going up, the 10 year US risk free bond now pays 3%
imagine 1-2 years later the same bond pays 5% risk free instead

if you are a new investor looking for income, what's stopping you from putting your 100k into a risk free 5% annual income?
say you are a bit more greedy and you want a higher yield... you may put it into reits... but what kinda returns are you looking for? probably 7-8% yield

yes, as investors demand for higher dividend yields, traditional dividend plays like reits and telcos will have to yield 7-8% and thus their stock prices will be way lower than the current prices you have seen now

thus my divestment of $SingTel(Z74.SI) in recent times at around 3.50 level, I was in for the NLT one time gains.. but the special dividends was too stingy.. still I took the dividends and then headed to the exits

I had held 5 reits $Suntec Reit(T82U.SI) $CapitaCom Trust(C61U.SI) $CapitaMall Trust(C38U.SI) $Mapletree Com Tr(N2IU.SI) $Frasers Cpt Tr(J69U.SI)

and had divested 3 of them while keeping CMT and MCT only, I am keeping a balanced approach with less than 20% of my portfolio exposed to reits... I do not want to be caught in the reits sell down when it happens.

so how should we invest in a rising rate environment?

firstly I think we should prefer net cash companies over highly geared companies
as higher rates will lead to higher interest costs
higher interest costs will lead to lower earnings

some net cash growth companies that I own are
$ComfortDelGro(C52.SI) $Sheng Siong(OV8.SI) $HRnetGroup(CHZ.SI)

their businesses are very cash generative and they do not need to take on debt to grow their business year after year

$ThaiBev(Y92.SI) would be an exception as its gearing is very high at 150%, it has taken up a lot of debt to fund its 4 major acquisitions thus making it very at risk of high rates, however management has been prudent in locking in the rates by issuing bonds at average cost of under 3% at 2/5/10 year maturity.. so basically they have already locked in the current low rates for the years to come.. so I am not that worried

however given that said, do not forget that thaibev is still a higher risk stock while netcash companies like CDG,SS,HRN are safer and less exciting picks.

as rates goes up, reits will have to pay higher cost on their debt... thus DPU may fall and equity rising (rights issue/placement) will get more and more common

I am bearish on reits and would surely prefer net cash companies over highly geared companies

cheers

Read more

There are more for you ...

View more and participate in our discussion now. It's FREE.

Creating an account means you’re okay with InvestingNote's Terms and Conditions