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
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
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
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
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.